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  • MIL-OSI USA: Memorandum on Advancing the United  States’ Leadership in Artificial Intelligence; Harnessing Artificial Intelligence to Fulfill National Security Objectives; and Fostering the Safety, Security, and Trustworthiness of Artificial  Intelligence

    US Senate News:

    Source: The White House
    MEMORANDUM FOR THE VICE PRESIDENT
                   THE SECRETARY OF STATE
                   THE SECRETARY OF THE TREASURY
                   THE SECRETARY OF DEFENSE
                   THE ATTORNEY GENERAL
                   THE SECRETARY OF COMMERCE
                   THE SECRETARY OF ENERGY
                   THE SECRETARY OF HEALTH AND HUMAN SERVICES
                   THE SECRETARY OF HOMELAND SECURITY
                   THE DIRECTOR OF THE OFFICE OF MANAGEMENT AND BUDGET
                   THE DIRECTOR OF NATIONAL INTELLIGENCE
                   THE REPRESENTATIVE OF THE UNITED STATES OF AMERICA TO THE UNITED NATIONS
                   THE DIRECTOR OF THE CENTRAL INTELLIGENCE AGENCY
                   THE ASSISTANT TO THE PRESIDENT AND CHIEF OF STAFF
                   THE ASSISTANT TO THE PRESIDENT FOR NATIONAL SECURITY AFFAIRS
                   THE ASSISTANT TO THE PRESIDENT FOR ECONOMIC
                      POLICY AND DIRECTOR OF THE NATIONAL ECONOMIC COUNCIL
                   THE CHAIR OF THE COUNCIL OF ECONOMIC ADVISERS
                   THE DIRECTOR OF THE OFFICE OF SCIENCE AND TECHNOLOGY POLICY
                   THE ADMINISTRATOR OF THE UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT
                   THE DIRECTOR OF THE NATIONAL SCIENCE FOUNDATION
                   THE DIRECTOR OF THE FEDERAL BUREAU OF INVESTIGATION
                   THE NATIONAL CYBER DIRECTOR
                   THE DIRECTOR OF THE OFFICE OF PANDEMIC PREPAREDNESS AND RESPONSE POLICY
                   THE DIRECTOR OF THE NATIONAL SECURITY AGENCY
                   THE DIRECTOR OF THE NATIONAL GEOSPATIAL-INTELLIGENCE AGENCY
                   THE DIRECTOR OF THE DEFENSE INTELLIGENCE AGENCY
    SUBJECT:       Advancing the United States’ Leadership in
                   Artificial Intelligence; Harnessing Artificial
                   Intelligence to Fulfill National Security
                   Objectives; and Fostering the Safety, Security,
                   and Trustworthiness of Artificial Intelligence
         Section 1.  Policy.  (a)  This memorandum fulfills the directive set forth in subsection 4.8 of Executive Order 14110 of October 30, 2023 (Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence).  This memorandum provides further direction on appropriately harnessing artificial intelligence (AI) models and AI-enabled technologies in the United States Government, especially in the context of national security systems (NSS), while protecting human rights, civil rights, civil liberties, privacy, and safety in AI-enabled national security activities.  A classified annex to this memorandum addresses additional sensitive national security issues, including countering adversary use of AI that poses risks to United States national security.
         (b)  United States national security institutions have historically triumphed during eras of technological transition.  To meet changing times, they developed new capabilities, from submarines and aircraft to space systems and cyber tools.  To gain a decisive edge and protect national security, they pioneered technologies such as radar, the Global Positioning System, and nuclear propulsion, and unleashed these hard-won breakthroughs on the battlefield.  With each paradigm shift, they also developed new systems for tracking and countering adversaries’ attempts to wield cutting-edge technology for their own advantage.
         (c)  AI has emerged as an era-defining technology and has demonstrated significant and growing relevance to national security.  The United States must lead the world in the responsible application of AI to appropriate national security functions.  AI, if used appropriately and for its intended purpose, can offer great benefits.  If misused, AI could threaten United States national security, bolster authoritarianism worldwide, undermine democratic institutions and processes, facilitate human rights abuses, and weaken the rules-based international order.  Harmful outcomes could occur even without malicious intent if AI systems and processes lack sufficient protections.
         (d)  Recent innovations have spurred not only an increase in AI use throughout society, but also a paradigm shift within the AI field — one that has occurred mostly outside of Government.  This era of AI development and deployment rests atop unprecedented aggregations of specialized computational power, as well as deep scientific and engineering expertise, much of which is concentrated in the private sector.  This trend is most evident with the rise of large language models, but it extends to a broader class of increasingly general-purpose and computationally intensive systems.  The United States Government must urgently consider how this current AI paradigm specifically could transform the national security mission.
         (e)  Predicting technological change with certainty is impossible, but the foundational drivers that have underpinned recent AI progress show little sign of abating.  These factors include compounding algorithmic improvements, increasingly efficient computational hardware, a growing willingness in industry to invest substantially in research and development, and the expansion of training data sets.  AI under the current paradigm may continue to become more powerful and general-purpose.  Developing and effectively using these systems requires an evolving array of resources, infrastructure, competencies, and workflows that in many cases differ from what was required to harness prior technologies, including previous paradigms of AI.
         (f)  If the United States Government does not act with responsible speed and in partnership with industry, civil society, and academia to make use of AI capabilities in service of the national security mission — and to ensure the safety, security, and trustworthiness of American AI innovation writ large — it risks losing ground to strategic competitors.  Ceding the United States’ technological edge would not only greatly harm American national security, but it would also undermine United States foreign policy objectives and erode safety, human rights, and democratic norms worldwide.
         (g)  Establishing national security leadership in AI will require making deliberate and meaningful changes to aspects of the United States Government’s strategies, capabilities, infrastructure, governance, and organization.  AI is likely to affect almost all domains with national security significance, and its use cannot be relegated to a single institutional silo.  The increasing generality of AI means that many functions that to date have been served by individual bespoke tools may, going forward, be better fulfilled by systems that, at least in part, rely on a shared, multi-purpose AI capability.  Such integration will only succeed if paired with appropriately redesigned United States Government organizational and informational infrastructure.
         (h)  In this effort, the United States Government must also protect human rights, civil rights, civil liberties, privacy, and safety, and lay the groundwork for a stable and responsible international AI governance landscape.  Throughout its history, the United States has been a global leader in shaping the design, development, and use of new technologies not only to advance national security, but also to protect and promote democratic values.  The United States Government must develop safeguards for its use of AI tools, and take an active role in steering global AI norms and institutions.  The AI frontier is moving quickly, and the United States Government must stay attuned to ongoing technical developments without losing focus on its guiding principles.
         (i)  This memorandum aims to catalyze needed change in how the United States Government approaches AI national security policy.  In line with Executive Order 14110, it directs actions to strengthen and protect the United States AI ecosystem; improve the safety, security, and trustworthiness of AI systems developed and used in the United States; enhance the United States Government’s appropriate, responsible, and effective adoption of AI in service of the national security mission; and minimize the misuse of AI worldwide.
    Sec. 2.  Objectives.  It is the policy of the United States Government that the following three objectives will guide its activities with respect to AI and national security.
         (a)  First, the United States must lead the world’s development of safe, secure, and trustworthy AI.  To that end, the United States Government must — in partnership with industry, civil society, and academia — promote and secure the foundational capabilities across the United States that power AI development.  The United States Government cannot take the unmatched vibrancy and innovativeness of the United States AI ecosystem for granted; it must proactively strengthen it, ensuring that the United States remains the most attractive destination for global talent and home to the world’s most sophisticated computational facilities.  The United States Government must also provide appropriate safety and security guidance to AI developers and users, and rigorously assess and help mitigate the risks that AI systems could pose.
         (b)  Second, the United States Government must harness powerful AI, with appropriate safeguards, to achieve national security objectives.  Emerging AI capabilities, including increasingly general-purpose models, offer profound opportunities for enhancing national security, but employing these systems effectively will require significant technical, organizational, and policy changes.  The United States must understand AI’s limitations as it harnesses the technology’s benefits, and any use of AI must respect democratic values with regard to transparency, human rights, civil rights, civil liberties, privacy, and safety.
         (c)  Third, the United States Government must continue cultivating a stable and responsible framework to advance international AI governance that fosters safe, secure, and trustworthy AI development and use; manages AI risks; realizes democratic values; respects human rights, civil rights, civil liberties, and privacy; and promotes worldwide benefits from AI.  It must do so in collaboration with a wide range of allies and partners.  Success for the United States in the age of AI will be measured not only by the preeminence of United States technology and innovation, but also by the United States’ leadership in developing effective global norms and engaging in institutions rooted in international law, human rights, civil rights, and democratic values.
    Sec. 3.  Promoting and Securing the United States’ Foundational AI Capabilities.  (a)  To preserve and expand United States advantages in AI, it is the policy of the United States Government to promote progress, innovation, and competition in domestic AI development; protect the United States AI ecosystem against foreign intelligence threats; and manage risks to AI safety, security, and trustworthiness.  Leadership in responsible AI development benefits United States national security by enabling applications directly relevant to the national security mission, unlocking economic growth, and avoiding strategic surprise.  United States technological leadership also confers global benefits by enabling like-minded entities to collectively mitigate the risks of AI misuse and accidents, prevent the unchecked spread of digital authoritarianism, and prioritize vital research.
         3.1.  Promoting Progress, Innovation, and Competition in United States AI Development.  (a)  The United States’ competitive edge in AI development will be at risk absent concerted United States Government efforts to promote and secure domestic AI progress, innovation, and competition.  Although the United States has benefited from a head start in AI, competitors are working hard to catch up, have identified AI as a top strategic priority, and may soon devote resources to research and development that United States AI developers cannot match without appropriately supportive Government policies and action.  It is therefore the policy of the United States Government to enhance innovation and competition by bolstering key drivers of AI progress, such as technical talent and computational power.
         (b)  It is the policy of the United States Government that advancing the lawful ability of noncitizens highly skilled in AI and related fields to enter and work in the United States constitutes a national security priority.  Today, the unparalleled United States AI industry rests in substantial part on the insights of brilliant scientists, engineers, and entrepreneurs who moved to the United States in pursuit of academic, social, and economic opportunity.  Preserving and expanding United States talent advantages requires developing talent at home and continuing to attract and retain top international minds.
         (c)  Consistent with these goals:
    (i)    On an ongoing basis, the Department of State, the Department of Defense (DOD), and the Department of Homeland Security (DHS) shall each use all available legal authorities to assist in attracting and rapidly bringing to the United States individuals with relevant technical expertise who would improve United States competitiveness in AI and related fields, such as semiconductor design and production.  These activities shall include all appropriate vetting of these individuals and shall be consistent with all appropriate risk mitigation measures.  This tasking is consistent with and additive to the taskings on attracting AI talent in section 5 of Executive Order 14110.
    (ii)   Within 180 days of the date of this memorandum, the Chair of the Council of Economic Advisers shall prepare an analysis of the AI talent market in the United States and overseas, to the extent that reliable data is available.
    (iii)  Within 180 days of the date of this memorandum, the Assistant to the President for Economic Policy and Director of the National Economic Council shall coordinate an economic assessment of the relative competitive advantage of the United States private sector AI ecosystem, the key sources of the United States private sector’s competitive advantage, and possible risks to that position, and shall recommend policies to mitigate them.  The assessment could include areas including (1) the design, manufacture, and packaging of chips critical in AI-related activities; (2) the availability of capital; (3) the availability of workers highly skilled in AI-related fields; (4) computational resources and the associated electricity requirements; and (5) technological platforms or institutions with the requisite scale of capital and data resources for frontier AI model development, as well as possible other factors.
    (iv)   Within 90 days of the date of this memorandum, the Assistant to the President for National Security Affairs (APNSA) shall convene appropriate executive departments and agencies (agencies) to explore actions for prioritizing and streamlining administrative processing operations for all visa applicants working with sensitive technologies.  Doing so shall assist with streamlined processing of highly skilled applicants in AI and other critical and emerging technologies.  This effort shall explore options for ensuring the adequate resourcing of such operations and narrowing the criteria that trigger secure advisory opinion requests for such applicants, as consistent with national security objectives.
         (d)  The current paradigm of AI development depends heavily on computational resources.  To retain its lead in AI, the United States must continue developing the world’s most sophisticated AI semiconductors and constructing its most advanced AI-dedicated computational infrastructure.
         (e)  Consistent with these goals:
    (i)    DOD, the Department of Energy (DOE) (including national laboratories), and the Intelligence Community (IC) shall, when planning for and constructing or renovating computational facilities, consider the applicability of large-scale AI to their mission.  Where appropriate, agencies shall design and build facilities capable of harnessing frontier AI for relevant scientific research domains and intelligence analysis.  Those investments shall be consistent with the Federal Mission Resilience Strategy adopted in Executive Order 13961 of December 7, 2020 (Governance and Integration of Federal Mission Resilience).
    (ii)   On an ongoing basis, the National Science Foundation (NSF) shall, consistent with its authorities, use the National AI Research Resource (NAIRR) pilot project and any future NAIRR efforts to distribute computational resources, data, and other critical assets for AI development to a diverse array of actors that otherwise would lack access to such capabilities — such as universities, nonprofits, and independent researchers (including trusted international collaborators) — to ensure that AI research in the United States remains competitive and innovative.  This tasking is consistent with the NAIRR pilot assigned in section 5 of Executive Order 14110.
    (iii)  Within 180 days of the date of this memorandum, DOE shall launch a pilot project to evaluate the performance and efficiency of federated AI and data sources for frontier AI-scale training, fine-tuning, and inference.
    (iv)   The Office of the White House Chief of Staff, in coordination with DOE and other relevant agencies, shall coordinate efforts to streamline permitting, approvals, and incentives for the construction of AI-enabling infrastructure, as well as surrounding assets supporting the resilient operation of this infrastructure, such as clean energy generation, power transmission lines, and high-capacity fiber data links.  These efforts shall include coordination, collaboration, consultation, and partnership with State, local, Tribal, and territorial governments, as appropriate, and shall be consistent with the United States’ goals for managing climate risks.
    (v)    The Department of State, DOD, DOE, the IC, and the Department of Commerce (Commerce) shall, as appropriate and consistent with applicable law, use existing authorities to make public investments and encourage private investments in strategic domestic and foreign AI technologies and adjacent fields.  These agencies shall assess the need for new authorities for the purposes of facilitating public and private investment in AI and adjacent capabilities.
         3.2.  Protecting United States AI from Foreign Intelligence Threats.  (a)  In addition to pursuing industrial strategies that support their respective AI industries, foreign states almost certainly aim to obtain and repurpose the fruits of AI innovation in the United States to serve their national security goals.  Historically, such competitors have employed techniques including research collaborations, investment schemes, insider threats, and advanced cyber espionage to collect and exploit United States scientific insights.  It is the policy of the United States Government to protect United States industry, civil society, and academic AI intellectual property and related infrastructure from foreign intelligence threats to maintain a lead in foundational capabilities and, as necessary, to provide appropriate Government assistance to relevant non-government entities.
         (b)  Consistent with these goals:
    (i)   Within 90 days of the date of this memorandum, the National Security Council (NSC) staff and the Office of the Director of National Intelligence (ODNI) shall review the President’s Intelligence Priorities and the National Intelligence Priorities Framework consistent with National Security Memorandum 12 of July 12, 2022 (The President’s Intelligence Priorities), and make recommendations to ensure that such priorities improve identification and assessment of foreign intelligence threats to the United States AI ecosystem and closely related enabling sectors, such as those involved in semiconductor design and production.
    (ii)  Within 180 days of the date of this memorandum, and on an ongoing basis thereafter, ODNI, in coordination with DOD, the Department of Justice (DOJ), Commerce, DOE, DHS, and other IC elements as appropriate, shall identify critical nodes in the AI supply chain, and develop a list of the most plausible avenues through which these nodes could be disrupted or compromised by foreign actors.  On an ongoing basis, these agencies shall take all steps, as appropriate and consistent with applicable law, to reduce such risks.
         (c)  Foreign actors may also seek to obtain United States intellectual property through gray-zone methods, such as technology transfer and data localization requirements.  AI-related intellectual property often includes critical technical artifacts (CTAs) that would substantially lower the costs of recreating, attaining, or using powerful AI capabilities.  The United States Government must guard against these risks.
         (d)  Consistent with these goals:
    (i)  In furtherance of Executive Order 14083 of September 15, 2022 (Ensuring Robust Consideration of Evolving National Security Risks by the Committee on Foreign Investment in the United States), the Committee on Foreign Investment in the United States shall, as appropriate, consider whether a covered transaction involves foreign actor access to proprietary information on AI training techniques, algorithmic improvements, hardware advances, CTAs, or other proprietary insights that shed light on how to create and effectively use powerful AI systems.
         3.3.  Managing Risks to AI Safety, Security, and Trustworthiness.  (a)  Current and near-future AI systems could pose significant safety, security, and trustworthiness risks, including those stemming from deliberate misuse and accidents.  Across many technological domains, the United States has historically led the world not only in advancing capabilities, but also in developing the tests, standards, and norms that underpin reliable and beneficial global adoption.  The United States approach to AI should be no different, and proactively constructing testing infrastructure to assess and mitigate AI risks will be essential to realizing AI’s positive potential and to preserving United States AI leadership.
         (b)  It is the policy of the United States Government to pursue new technical and policy tools that address the potential challenges posed by AI.  These tools include processes for reliably testing AI models’ applicability to harmful tasks and deeper partnerships with institutions in industry, academia, and civil society capable of advancing research related to AI safety, security, and trustworthiness.
         (c)  Commerce, acting through the AI Safety Institute (AISI) within the National Institute of Standards and Technology (NIST), shall serve as the primary United States Government point of contact with private sector AI developers to facilitate voluntary pre- and post-public deployment testing for safety, security, and trustworthiness of frontier AI models.  In coordination with relevant agencies as appropriate, Commerce shall establish an enduring capability to lead voluntary unclassified pre-deployment safety testing of frontier AI models on behalf of the United States Government, including assessments of risks relating to cybersecurity, biosecurity, chemical weapons, system autonomy, and other risks as appropriate (not including nuclear risk, the assessment of which shall be led by DOE).  Voluntary unclassified safety testing shall also, as appropriate, address risks to human rights, civil rights, and civil liberties, such as those related to privacy, discrimination and bias, freedom of expression, and the safety of individuals and groups.  Other agencies, as identified in subsection 3.3(f) of this section, shall establish enduring capabilities to perform complementary voluntary classified testing in appropriate areas of expertise.  The directives set forth in this subsection are consistent with broader taskings on AI safety in section 4 of Executive Order 14110, and provide additional clarity on agencies’ respective roles and responsibilities.
         (d)  Nothing in this subsection shall inhibit agencies from performing their own evaluations of AI systems, including tests performed before those systems are released to the public, for the purposes of evaluating suitability for that agency’s acquisition and procurement.  AISI’s responsibilities do not extend to the evaluation of AI systems for the potential use by the United States Government for national security purposes; those responsibilities lie with agencies considering such use, as outlined in subsection 4.2(e) of this memorandum and the associated framework described in that subsection.
         (e)  Consistent with these goals, Commerce, acting through AISI within NIST, shall take the following actions to aid in the evaluation of current and near-future AI systems:
    (i)    Within 180 days of the date of this memorandum and subject to private sector cooperation, AISI shall pursue voluntary preliminary testing of at least two frontier AI models prior to their public deployment or release to evaluate capabilities that might pose a threat to national security.  This testing shall assess models’ capabilities to aid offensive cyber operations, accelerate development of biological and/or chemical weapons, autonomously carry out malicious behavior, automate development and deployment of other models with such capabilities, and give rise to other risks identified by AISI.  AISI shall share feedback with the APNSA, interagency counterparts as appropriate, and the respective model developers regarding the results of risks identified during such testing and any appropriate mitigations prior to deployment.
    (ii)   Within 180 days of the date of this memorandum, AISI shall issue guidance for AI developers on how to test, evaluate, and manage risks to safety, security, and trustworthiness arising from dual-use foundation models, building on guidelines issued pursuant to subsection 4.1(a) of Executive Order 14110.  AISI shall issue guidance on topics including:
    (A)  How to measure capabilities that are relevant to the risk that AI models could enable the development of biological and chemical weapons or the automation of offensive cyber operations;
    (B)  How to address societal risks, such as the misuse of models to harass or impersonate individuals;
    (C)  How to develop mitigation measures to prevent malicious or improper use of models;
    (D)  How to test the efficacy of safety and security mitigations; and
    (E)  How to apply risk management practices throughout the development and deployment lifecycle (pre-development, development, and deployment/release).
    (iii)  Within 180 days of the date of this memorandum, AISI, in consultation with other agencies as appropriate, shall develop or recommend benchmarks or other methods for assessing AI systems’ capabilities and limitations in science, mathematics, code generation, and general reasoning, as well as other categories of activity that AISI deems relevant to assessing general-purpose capabilities likely to have a bearing on national security and public safety.
    (iv)   In the event that AISI or another agency determines that a dual-use foundation model’s capabilities could be used to harm public safety significantly, AISI shall serve as the primary point of contact through which the United States Government communicates such findings and any associated recommendations regarding risk mitigation to the developer of the model.
    (v)    Within 270 days of the date of this memorandum, and at least annually thereafter, AISI shall submit to the President, through the APNSA, and provide to other interagency counterparts as appropriate, at minimum one report that shall include the following:
    (A)  A summary of findings from AI safety assessments of frontier AI models that have been conducted by or shared with AISI;
    (B)  A summary of whether AISI deemed risk mitigation necessary to resolve any issues identified in the assessments, along with conclusions regarding any mitigations’ efficacy; and
    (C)  A summary of the adequacy of the science-based tools and methods used to inform such assessments.
         (f)  Consistent with these goals, other agencies specified below shall take the following actions, in coordination with Commerce, acting through AISI within NIST, to provide classified sector-specific evaluations of current and near-future AI systems for cyber, nuclear, and radiological risks:
    (i)    All agencies that conduct or fund safety testing and evaluations of AI systems shall share the results of such evaluations with AISI within 30 days of their completion, consistent with applicable protections for classified and controlled information.
    (ii)   Within 120 days of the date of this memorandum, the National Security Agency (NSA), acting through its AI Security Center (AISC) and in coordination with AISI, shall develop the capability to perform rapid systematic classified testing of AI models’ capacity to detect, generate, and/or exacerbate offensive cyber threats.  Such tests shall assess the degree to which AI systems, if misused, could accelerate offensive cyber operations.
    (iii)  Within 120 days of the date of this memorandum, DOE, acting primarily through the National Nuclear Security Administration (NNSA) and in close coordination with AISI and NSA, shall seek to develop the capability to perform rapid systematic testing of AI models’ capacity to generate or exacerbate nuclear and radiological risks.  This initiative shall involve the development and maintenance of infrastructure capable of running classified and unclassified tests, including using restricted data and relevant classified threat information.  This initiative shall also feature the creation and regular updating of automated evaluations, the development of an interface for enabling human-led red-teaming, and the establishment of technical and legal tooling necessary for facilitating the rapid and secure transfer of United States Government, open-weight, and proprietary models to these facilities.  As part of this initiative:
    (A)  Within 180 days of the date of this memorandum, DOE shall use the capability described in subsection 3.3(f)(iii) of this section to complete initial evaluations of the radiological and nuclear knowledge, capabilities, and implications of a frontier AI model no more than 30 days after the model has been made available to NNSA at an appropriate classification level.  These evaluations shall involve tests of AI systems both without significant modifications and, as appropriate, with fine-tuning or other modifications that could enhance performance.
    (B)  Within 270 days of the date of this memorandum, and at least annually thereafter, DOE shall submit to the President, through the APNSA, at minimum one assessment that shall include the following:
    (1)  A concise summary of the findings of each AI model evaluation for radiological and nuclear risk, described in subsection 3.3(f)(iii)(A) of this section, that DOE has performed in the preceding 12 months;
    (2)  A recommendation as to whether corrective action is necessary to resolve any issues identified in the evaluations, including but not limited to actions necessary for attaining and sustaining compliance conditions appropriate to safeguard and prevent unauthorized disclosure of restricted data or other classified information, pursuant to the Atomic Energy Act of 1954; and
    (3)  A concise statement regarding the adequacy of the science-based tools and methods used to inform the evaluations.
    (iv)   On an ongoing basis, DHS, acting through the Cybersecurity and Infrastructure Security Agency (CISA), shall continue to fulfill its responsibilities with respect to the application of AISI guidance, as identified in National Security Memorandum 22 of April 30, 2024 (Critical Infrastructure Security and Resilience), and section 4 of Executive Order 14110.
         (g)  Consistent with these goals, and to reduce the chemical and biological risks that could emerge from AI:
    (i)    The United States Government shall advance classified evaluations of advanced AI models’ capacity to generate or exacerbate deliberate chemical and biological threats.  As part of this initiative:
    (A)  Within 210 days of the date of this memorandum, DOE, DHS, and AISI, in consultation with DOD and other relevant agencies, shall coordinate to develop a roadmap for future classified evaluations of advanced AI models’ capacity to generate or exacerbate deliberate chemical and biological threats, to be shared with the APNSA.  This roadmap shall consider the scope, scale, and priority of classified evaluations; proper safeguards to ensure that evaluations and simulations are not misconstrued as offensive capability development; proper safeguards for testing sensitive and/or classified information; and sustainable implementation of evaluation methodologies.
    (B)  On an ongoing basis, DHS shall provide expertise, threat and risk information, and other technical support to assess the feasibility of proposed biological and chemical classified evaluations; interpret and contextualize evaluation results; and advise relevant agencies on potential risk mitigations.
    (C)  Within 270 days of the date of this memorandum, DOE shall establish a pilot project to provide expertise, infrastructure, and facilities capable of conducting classified tests in this area.
    (ii)   Within 240 days of the date of this memorandum, DOD, the Department of Health and Human Services (HHS), DOE (including national laboratories), DHS, NSF, and other agencies pursuing the development of AI systems substantially trained on biological and chemical data shall, as appropriate, support efforts to utilize high-performance computing resources and AI systems to enhance biosafety and biosecurity.  These efforts shall include:
    (A)  The development of tools for screening in silico chemical and biological research and technology;
    (B)  The creation of algorithms for nucleic acid synthesis screening;
    (C)  The construction of high-assurance software foundations for novel biotechnologies;
    (D)  The screening of complete orders or data streams from cloud labs and biofoundries; and
    (E)  The development of risk mitigation strategies such as medical countermeasures.
    (iii)  After the publication of biological and chemical safety guidance by AISI outlined in subsection 3.3(e) of this section, all agencies that directly develop relevant dual-use foundation AI models that are made available to the public and are substantially trained on biological or chemical data shall incorporate this guidance into their agency’s practices, as appropriate and feasible.
    (iv)   Within 180 days of the date of this memorandum, NSF, in coordination with DOD, Commerce (acting through AISI within NIST), HHS, DOE, the Office of Science and Technology Policy (OSTP), and other relevant agencies, shall seek to convene academic research institutions and scientific publishers to develop voluntary best practices and standards for publishing computational biological and chemical models, data sets, and approaches, including those that use AI and that could contribute to the production of knowledge, information, technologies, and products that could be misused to cause harm.  This is in furtherance of the activities described in subsections 4.4 and 4.7 of Executive Order 14110.
    (v)    Within 540 days of the date of this memorandum, and informed by the United States Government Policy for Oversight of Dual Use Research of Concern and Pathogens with Enhanced Pandemic Potential, OSTP, NSC staff, and the Office of Pandemic Preparedness and Response Policy, in consultation with relevant agencies and external stakeholders as appropriate, shall develop guidance promoting the benefits of and mitigating the risks associated with in silico biological and chemical research.
         (h)  Agencies shall take the following actions to improve foundational understanding of AI safety, security, and trustworthiness:
    (i)   DOD, Commerce, DOE, DHS, ODNI, NSF, NSA, and the National Geospatial-Intelligence Agency (NGA) shall, as appropriate and consistent with applicable law, prioritize research on AI safety and trustworthiness.  As appropriate and consistent with existing authorities, they shall pursue partnerships as appropriate with leading public sector, industry, civil society, academic, and other institutions with expertise in these domains, with the objective of accelerating technical and socio-technical progress in AI safety and trustworthiness.  This work may include research on interpretability, formal methods, privacy enhancing technologies, techniques to address risks to civil liberties and human rights, human-AI interaction, and/or the socio-technical effects of detecting and labeling synthetic and authentic content (for example, to address the malicious use of AI to generate misleading videos or images, including those of a strategically damaging or non-consensual intimate nature, of political or public figures).
    (ii)  DOD, Commerce, DOE, DHS, ODNI, NSF, NSA, and NGA shall, as appropriate and consistent with applicable law, prioritize research to improve the security, robustness, and reliability of AI systems and controls.  These entities shall, as appropriate and consistent with applicable law, partner with other agencies, industry, civil society, and academia.  Where appropriate, DOD, DHS (acting through CISA), the Federal Bureau of Investigation, and NSA (acting through AISC) shall publish unclassified guidance concerning known AI cybersecurity vulnerabilities and threats; best practices for avoiding, detecting, and mitigating such issues during model training and deployment; and the integration of AI into other software systems.  This work shall include an examination of the role of and vulnerabilities potentially caused by AI systems used in critical infrastructure.
         (i)  Agencies shall take actions to protect classified and controlled information, given the potential risks posed by AI:
    (i)  In the course of regular updates to policies and procedures, DOD, DOE, and the IC shall consider how analysis enabled by AI tools may affect decisions related to declassification of material, standards for sufficient anonymization, and similar activities, as well as the robustness of existing operational security and equity controls to protect classified or controlled information, given that AI systems have demonstrated the capacity to extract previously inaccessible insight from redacted and anonymized data.
    Sec. 4.  Responsibly Harnessing AI to Achieve National Security Objectives.  (a)  It is the policy of the United States Government to act decisively to enable the effective and responsible use of AI in furtherance of its national security mission.  Achieving global leadership in national security applications of AI will require effective partnership with organizations outside Government, as well as significant internal transformation, including strengthening effective oversight and governance functions.
         4.1.  Enabling Effective and Responsible Use of AI.  (a)  It is the policy of the United States Government to adapt its partnerships, policies, and infrastructure to use AI capabilities appropriately, effectively, and responsibly.  These modifications must balance each agency’s unique oversight, data, and application needs with the substantial benefits associated with sharing powerful AI and computational resources across the United States Government.  Modifications must also be grounded in a clear understanding of the United States Government’s comparative advantages relative to industry, civil society, and academia, and must leverage offerings from external collaborators and contractors as appropriate.  The United States Government must make the most of the rich United States AI ecosystem by incentivizing innovation in safe, secure, and trustworthy AI and promoting industry competition when selecting contractors, grant recipients, and research collaborators.  Finally, the United States Government must address important technical and policy considerations in ways that ensure the integrity and interoperability needed to pursue its objectives while protecting human rights, civil rights, civil liberties, privacy, and safety.
         (b)  The United States Government needs an updated set of Government-wide procedures for attracting, hiring, developing, and retaining AI and AI-enabling talent for national security purposes.
         (c)  Consistent with these goals:
    (i)   In the course of regular legal, policy, and compliance framework reviews, the Department of State, DOD, DOJ, DOE, DHS, and IC elements shall revise, as appropriate, their hiring and retention policies and strategies to accelerate responsible AI adoption.  Agencies shall account for technical talent needs required to adopt AI and integrate it into their missions and other roles necessary to use AI effectively, such as AI-related governance, ethics, and policy positions.  These policies and strategies shall identify financial, organizational, and security hurdles, as well as potential mitigations consistent with applicable law.  Such measures shall also include consideration of programs to attract experts with relevant technical expertise from industry, academia, and civil society — including scholarship for service programs — and similar initiatives that would expose Government employees to relevant non-government entities in ways that build technical, organizational, and cultural familiarity with the AI industry.  These policies and strategies shall use all available authorities, including expedited security clearance procedures as appropriate, in order to address the shortfall of AI-relevant talent within Government.
    (ii)  Within 120 days of the date of this memorandum, the Department of State, DOD, DOJ, DOE, DHS, and IC elements shall each, in consultation with the Office of Management and Budget (OMB), identify education and training opportunities to increase the AI competencies of their respective workforces, via initiatives which may include training and skills-based hiring.
         (d)  To accelerate the use of AI in service of its national security mission, the United States Government needs coordinated and effective acquisition and procurement systems.  This will require an enhanced capacity to assess, define, and articulate AI-related requirements for national security purposes, as well as improved accessibility for AI companies that lack significant prior experience working with the United States Government.
         (e)  Consistent with these goals:
    (i)    Within 30 days of the date of this memorandum, DOD and ODNI, in coordination with OMB and other agencies as appropriate, shall establish a working group to address issues involving procurement of AI by DOD and IC elements and for use on NSS.  As appropriate, the working group shall consult the Director of the NSA, as the National Manager for NSS, in developing recommendations for acquiring and procuring AI for use on NSS.
    (ii)   Within 210 days of the date of this memorandum, the working group described in subsection 4.1(e)(i) of this section shall provide written recommendations to the Federal Acquisition Regulatory Council (FARC) regarding changes to existing regulations and guidance, as appropriate and consistent with applicable law, to promote the following objectives for AI procured by DOD and IC elements and for use on NSS:
    (A)  Ensuring objective metrics to measure and promote the safety, security, and trustworthiness of AI systems;
    (B)  Accelerating the acquisition and procurement process for AI, consistent with the Federal Acquisition Regulation, while maintaining appropriate checks to mitigate safety risks;  
    (C)  Simplifying processes such that companies without experienced contracting teams may meaningfully compete for relevant contracts, to ensure that the United States Government has access to a wide range of AI systems and that the AI marketplace is competitive;
    (D)  Structuring competitions to encourage robust participation and achieve best value to the Government, such as by including requirements that promote interoperability and prioritizing the technical capability of vendors when evaluating offers;
    (E)  Accommodating shared use of AI to the greatest degree possible and as appropriate across relevant agencies; and
    (F)  Ensuring that agencies with specific authorities and missions may implement other policies, where appropriate and necessary.
    (iii)  The FARC shall, as appropriate and consistent with applicable law, consider proposing amendments to the Federal Acquisition Regulation to codify recommendations provided by the working group pursuant to subsection 4.1(e)(ii) of this section that may have Government-wide application.
    (iv)   DOD and ODNI shall seek to engage on an ongoing basis with diverse United States private sector stakeholders — including AI technology and defense companies and members of the United States investor community — to identify and better understand emerging capabilities that would benefit or otherwise affect the United States national security mission.
         (f)  The United States Government needs clear, modernized, and robust policies and procedures that enable the rapid development and national security use of AI, consistent with human rights, civil rights, civil liberties, privacy, safety, and other democratic values.
         (g)  Consistent with these goals:
    (i)    DOD and the IC shall, in consultation with DOJ as appropriate, review their respective legal, policy, civil liberties, privacy, and compliance frameworks, including international legal obligations, and, as appropriate and consistent with applicable law, seek to develop or revise policies and procedures to enable the effective and responsible use of AI, accounting for the following:
    (A)  Issues raised by the acquisition, use, retention, dissemination, and disposal of models trained on datasets that include personal information traceable to specific United States persons, publicly available information, commercially available information, and intellectual property, consistent with section 9 of Executive Order 14110;
    (B)  Guidance that shall be developed by DOJ, in consultation with DOD and ODNI, regarding constitutional considerations raised by the IC’s acquisition and use of AI;
    (C)  Challenges associated with classification and compartmentalization;
    (D)  Algorithmic bias, inconsistent performance, inaccurate outputs, and other known AI failure modes;
    (E)  Threats to analytic integrity when employing AI tools;
    (F)  Risks posed by a lack of safeguards that protect human rights, civil rights, civil liberties, privacy, and other democratic values, as addressed in further detail in subsection 4.2 of this section;
    (G)  Barriers to sharing AI models and related insights with allies and partners; and
    (H)  Potential inconsistencies between AI use and the implementation of international legal obligations and commitments.
    (ii)   As appropriate, the policies described in subsection 4.1(g) of this section shall be consistent with direction issued by the Committee on NSS and DOD governing the security of AI used on NSS, policies issued by the Director of National Intelligence governing adoption of AI by the IC, and direction issued by OMB governing the security of AI used on non-NSS.
    (iii)  On an ongoing basis, each agency that uses AI on NSS shall, in consultation with ODNI and DOD, take all steps appropriate and consistent with applicable law to accelerate responsible approval of AI systems for use on NSS and accreditation of NSS that use AI systems.
         (h)  The United States’ network of allies and partners confers significant advantages over competitors.  Consistent with the 2022 National Security Strategy or any successor strategies, the United States Government must invest in and proactively enable the co-development and co-deployment of AI capabilities with select allies and partners.
         (i)  Consistent with these goals:
    (i)  Within 150 days of the date of this memorandum, DOD, in coordination with the Department of State and ODNI, shall evaluate the feasibility of advancing, increasing, and promoting co-development and shared use of AI and AI-enabled assets with select allies and partners.  This evaluation shall include:
    (A)  A potential list of foreign states with which such co-development or co-deployment may be feasible;
    (B)  A list of bilateral and multilateral fora for potential outreach;
    (C)  Potential co-development and co-deployment concepts;
    (D)  Proposed classification-appropriate testing vehicles for co-developed AI capabilities; and
    (E)  Considerations for existing programs, agreements, or arrangements to use as foundations for future co-development and co-deployment of AI capabilities.
         (j)  The United States Government needs improved internal coordination with respect to its use of and approach to AI on NSS in order to ensure interoperability and resource sharing consistent with applicable law, and to reap the generality and economies of scale offered by frontier AI models.
         (k)  Consistent with these goals:
    (i)  On an ongoing basis, DOD and ODNI shall issue or revise relevant guidance to improve consolidation and interoperability across AI functions on NSS.  This guidance shall seek to ensure that the United States Government can coordinate and share AI-related resources effectively, as appropriate and consistent with applicable law.  Such work shall include:
    (A)  Recommending agency organizational practices to improve AI research and deployment activities that span multiple national security institutions.  In order to encourage AI adoption for the purpose of national security, these measures shall aim to create consistency to the greatest extent possible across the revised practices.
    (B)  Steps that enable consolidated research, development, and procurement for general-purpose AI systems and supporting infrastructure, such that multiple agencies can share access to these tools to the extent consistent with applicable law, while still allowing for appropriate controls on sensitive data.
    (C)  Aligning AI-related national security policies and procedures across agencies, as practicable and appropriate, and consistent with applicable law.
    (D)  Developing policies and procedures, as appropriate and consistent with applicable law, to share information across DOD and the IC when an AI system developed, deployed, or used by a contractor demonstrates risks related to safety, security, and trustworthiness, including to human rights, civil rights, civil liberties, or privacy.
         4.2.  Strengthening AI Governance and Risk Management.  (a)  As the United States Government moves swiftly to adopt AI in support of its national security mission, it must continue taking active steps to uphold human rights, civil rights, civil liberties, privacy, and safety; ensure that AI is used in a manner consistent with the President’s authority as Commander in Chief to decide when to order military operations in the Nation’s defense; and ensure that military use of AI capabilities is accountable, including through such use during military operations within a responsible human chain of command and control.  Accordingly, the United States Government must develop and implement robust AI governance and risk management practices to ensure that its AI innovation aligns with democratic values, updating policy guidance where necessary.  In light of the diverse authorities and missions across covered agencies with a national security mission and the rapid rate of ongoing technological change, such AI governance and risk management frameworks shall be:
    (i)    Structured, to the extent permitted by law, such that they can adapt to future opportunities and risks posed by new technical developments;
    (ii)   As consistent across agencies as is practicable and appropriate in order to enable interoperability, while respecting unique authorities and missions;
    (iii)  Designed to enable innovation that advances United States national security objectives;
    (iv)   As transparent to the public as practicable and appropriate, while protecting classified or controlled information;
    (v)    Developed and applied in a manner and with means to integrate protections, controls, and safeguards for human rights, civil rights, civil liberties, privacy, and safety where relevant; and
    (vi)   Designed to reflect United States leadership in establishing broad international support for rules and norms that reinforce the United States’ approach to AI governance and risk management.
         (b)  Covered agencies shall develop and use AI responsibly, consistent with United States law and policies, democratic values, and international law and treaty obligations, including international humanitarian and human rights law.  All agency officials retain their existing authorities and responsibilities established in other laws and policies.
         (c)  Consistent with these goals:
    (i)  Heads of covered agencies shall, consistent with their authorities, monitor, assess, and mitigate risks directly tied to their agency’s development and use of AI.  Such risks may result from reliance on AI outputs to inform, influence, decide, or execute agency decisions or actions, when used in a defense, intelligence, or law enforcement context, and may impact human rights, civil rights, civil liberties, privacy, safety, national security, and democratic values.  These risks from the use of AI include the following:
    (A)  Risks to physical safety:  AI use may pose unintended risks to human life or property.
    (B)  Privacy harms:  AI design, development, and operation may result in harm, embarrassment, unfairness, and prejudice to individuals.
    (C)  Discrimination and bias:  AI use may lead to unlawful discrimination and harmful bias, resulting in, for instance, inappropriate surveillance and profiling, among other harms.
    (D)  Inappropriate use:  operators using AI systems may not fully understand the capabilities and limitations of these technologies, including systems used in conflicts.  Such unfamiliarity could impact operators’ ability to exercise appropriate levels of human judgment.
    (E)  Lack of transparency:  agencies may have gaps in documentation of AI development and use, and the public may lack access to information about how AI is used in national security contexts because of the necessity to protect classified or controlled information.
    (F)  Lack of accountability:  training programs and guidance for agency personnel on the proper use of AI systems may not be sufficient, including to mitigate the risk of overreliance on AI systems (such as “automation bias”), and accountability mechanisms may not adequately address possible intentional or negligent misuse of AI-enabled technologies.
    (G)  Data spillage:  AI systems may reveal aspects of their training data — either inadvertently or through deliberate manipulation by malicious actors — and data spillage may result from AI systems trained on classified or controlled information when used on networks where such information is not permitted.
    (H)  Poor performance:  AI systems that are inappropriately or insufficiently trained, used for purposes outside the scope of their training set, or improperly integrated into human workflows may exhibit poor performance, including in ways that result in inconsistent outcomes or unlawful discrimination and harmful bias, or that undermine the integrity of decision-making processes.
    (I)  Deliberate manipulation and misuse:  foreign state competitors and malicious actors may deliberately undermine the accuracy and efficacy of AI systems, or seek to extract sensitive information from such systems.
         (d)  The United States Government’s AI governance and risk management policies must keep pace with evolving technology.
         (e)  Consistent with these goals:
    (i)   An AI framework, entitled “Framework to Advance AI Governance and Risk Management in National Security” (AI Framework), shall further implement this subsection.  The AI Framework shall be approved by the NSC Deputies Committee through the process described in National Security Memorandum 2 of February 4, 2021 (Renewing the National Security Council System), or any successor process, and shall be reviewed periodically through that process.  This process shall determine whether adjustments are needed to address risks identified in subsection 4.2(c) of this section and other topics covered in the AI Framework.  The AI Framework shall serve as a national security-focused counterpart to OMB’s Memorandum M-24-10 of March 28, 2024 (Advancing Governance, Innovation, and Risk Management for Agency Use of Artificial Intelligence), and any successor OMB policies.  To the extent feasible, appropriate, and consistent with applicable law, the AI Framework shall be as consistent as possible with these OMB policies and shall be made public.
    (ii)  The AI Framework described in subsection 4.2(e)(i) of this section and any successor document shall, at a minimum, and to the extent consistent with applicable law, specify the following:
    (A)  Each covered agency shall have a Chief AI Officer who holds primary responsibility within that agency, in coordination with other responsible officials, for managing the agency’s use of AI, promoting AI innovation within the agency, and managing risks from the agency’s use of AI consistent with subsection 3(b) of OMB Memorandum M-24-10, as practicable.
    (B)  Covered agencies shall have AI Governance Boards to coordinate and govern AI issues through relevant senior leaders from the agency.
    (C)  Guidance on AI activities that pose unacceptable levels of risk and that shall be prohibited.
    (D)  Guidance on AI activities that are “high impact” and require minimum risk management practices, including for high-impact AI use that affects United States Government personnel.  Such high-impact activities shall include AI whose output serves as a principal basis for a decision or action that could exacerbate or create significant risks to national security, international norms, human rights, civil rights, civil liberties, privacy, safety, or other democratic values.  The minimum risk management practices for high-impact AI shall include a mechanism for agencies to assess AI’s expected benefits and potential risks; a mechanism for assessing data quality; sufficient test and evaluation practices; mitigation of unlawful discrimination and harmful bias; human training, assessment, and oversight requirements; ongoing monitoring; and additional safeguards for military service members, the Federal civilian workforce, and individuals who receive an offer of employment from a covered agency.
    (E)  Covered agencies shall ensure privacy, civil liberties, and safety officials are integrated into AI governance and oversight structures.  Such officials shall report findings to the heads of agencies and oversight officials, as appropriate, using existing reporting channels when feasible.
    (F)  Covered agencies shall ensure that there are sufficient training programs, guidance, and accountability processes to enable proper use of AI systems.
    (G)  Covered agencies shall maintain an annual inventory of their high-impact AI use and AI systems and provide updates on this inventory to agency heads and the APNSA.
    (H)  Covered agencies shall ensure that whistleblower protections are sufficient to account for issues that may arise in the development and use of AI and AI systems.
    (I)  Covered agencies shall develop and implement waiver processes for high-impact AI use that balance robust implementation of risk mitigation measures in this memorandum and the AI Framework with the need to utilize AI to preserve and advance critical agency missions and operations.
    (J)  Covered agencies shall implement cybersecurity guidance or direction associated with AI systems issued by the National Manager for NSS to mitigate the risks posed by malicious actors exploiting new technologies, and to enable interoperability of AI across agencies.  Within 150 days of the date of this memorandum, and periodically thereafter, the National Manager for NSS shall issue minimum cybersecurity guidance and/or direction for AI used as a component of NSS, which shall be incorporated into AI governance guidance detailed in subsection 4.2(g)(i) of this section.
         (f)  The United States Government needs guidance specifically regarding the use of AI on NSS.
         (g)  Consistent with these goals:
    (i)  Within 180 days of the date of this memorandum, the heads of the Department of State, the Department of the Treasury, DOD, DOJ, Commerce, DOE, DHS, ODNI (acting on behalf of the 18 IC elements), and any other covered agency that uses AI as part of a NSS (Department Heads) shall issue or update guidance to their components/sub-agencies on AI governance and risk management for NSS, aligning with the policies in this subsection, the AI Framework, and other applicable policies.  Department Heads shall review their respective guidance on an annual basis, and update such guidance as needed.  This guidance, and any updates thereto, shall be provided to the APNSA prior to issuance.  This guidance shall be unclassified and made available to the public to the extent feasible and appropriate, though it may have a classified annex.  Department Heads shall seek to harmonize their guidance, and the APNSA shall convene an interagency meeting at least annually for the purpose of harmonizing Department Heads’ guidance on AI governance and risk management to the extent practicable and appropriate while respecting the agencies’ diverse authorities and missions.  Harmonization shall be pursued in the following areas:
    (A)  Implementation of the risk management practices for high-impact AI;
    (B)  AI and AI system standards and activities, including as they relate to training, testing, accreditation, and security and cybersecurity; and
    (C)  Any other issues that affect interoperability for AI and AI systems.
    Sec. 5.  Fostering a Stable, Responsible, and Globally Beneficial International AI Governance Landscape.  (a)  Throughout its history, the United States has played an essential role in shaping the international order to enable the safe, secure, and trustworthy global adoption of new technologies while also protecting democratic values.  These contributions have ranged from establishing nonproliferation regimes for biological, chemical, and nuclear weapons to setting the foundations for multi-stakeholder governance of the Internet.  Like these precedents, AI will require new global norms and coordination mechanisms, which the United States Government must maintain an active role in crafting.
         (b)  It is the policy of the United States Government that United States international engagement on AI shall support and facilitate improvements to the safety, security, and trustworthiness of AI systems worldwide; promote democratic values, including respect for human rights, civil rights, civil liberties, privacy, and safety; prevent the misuse of AI in national security contexts; and promote equitable access to AI’s benefits.  The United States Government shall advance international agreements, collaborations, and other substantive and norm-setting initiatives in alignment with this policy.
         (c)  Consistent with these goals:
    (i)  Within 120 days of the date of this memorandum, the Department of State, in coordination with DOD, Commerce, DHS, the United States Mission to the United Nations (USUN), and the United States Agency for International Development (USAID), shall produce a strategy for the advancement of international AI governance norms in line with safe, secure, and trustworthy AI, and democratic values, including human rights, civil rights, civil liberties, and privacy.  This strategy shall cover bilateral and multilateral engagement and relations with allies and partners.  It shall also include guidance on engaging with competitors, and it shall outline an approach to working in international institutions such as the United Nations and the Group of 7 (G7), as well as technical organizations.  The strategy shall:
    (A)  Develop and promote internationally shared definitions, norms, expectations, and standards, consistent with United States policy and existing efforts, which will promote safe, secure, and trustworthy AI development and use around the world.  These norms shall be as consistent as possible with United States domestic AI governance (including Executive Order 14110 and OMB Memorandum M-24-10), the International Code of Conduct for Organizations Developing Advanced AI Systems released by the G7 in October 2023, the Organization for Economic Cooperation and Development Principles on AI, United Nations General Assembly Resolution A/78/L.49, and other United States-supported relevant international frameworks (such as the Political Declaration on Responsible Military Use of AI and Autonomy) and instruments.  By discouraging misuse and encouraging appropriate safeguards, these norms and standards shall aim to reduce the likelihood of AI causing harm or having adverse impacts on human rights, democracy, or the rule of law.
    (B)  Promote the responsible and ethical use of AI in national security contexts in accordance with democratic values and in compliance with applicable international law.  The strategy shall advance the norms and practices established by this memorandum and measures endorsed in the Political Declaration on Responsible Military Use of AI and Autonomy.
    Sec. 6.  Ensuring Effective Coordination, Execution, and Reporting of AI Policy.  (a)  The United States Government must work in a closely coordinated manner to make progress on effective and responsible AI adoption.  Given the speed with which AI technology evolves, the United States Government must learn quickly, adapt to emerging strategic developments, adopt new capabilities, and confront novel risks.
         (b)  Consistent with these goals:
    (i)    Within 270 days of the date of this memorandum, and annually thereafter for at least the next 5 years, the heads of the Department of State, DOD, Commerce, DOE, ODNI (acting on behalf of the IC), USUN, and USAID shall each submit a report to the President, through the APNSA, that offers a detailed accounting of their activities in response to their taskings in all sections of this memorandum, including this memorandum’s classified annex, and that provides a plan for further action.  The Central Intelligence Agency (CIA), NSA, the Defense Intelligence Agency (DIA), and NGA shall submit reports on their activities to ODNI for inclusion in full as an appendix to ODNI’s report regarding IC activities.  NGA, NSA, and DIA shall submit their reports as well to DOD for inclusion in full as an appendix to DOD’s report.
    (ii)   Within 45 days of the date of this memorandum, the Chief AI Officers of the Department of State, DOD, DOJ, DOE, DHS, OMB, ODNI, CIA, DIA, NSA, and NGA, as well as appropriate technical staff, shall form an AI National Security Coordination Group (Coordination Group).  Any Chief AI Officer of an agency that is a member of the Committee on National Security Systems may also join the Coordination Group as a full member.  The Coordination Group shall be co-chaired by the Chief AI Officers of ODNI and DOD.  The Coordination Group shall consider ways to harmonize policies relating to the development, accreditation, acquisition, use, and evaluation of AI on NSS.  This work could include development of:
    (A)  Enhanced training and awareness to ensure that agencies prioritize the most effective AI systems, responsibly develop and use AI, and effectively evaluate AI systems;
    (B)  Best practices to identify and mitigate foreign intelligence risks and human rights considerations associated with AI procurement;
    (C)  Best practices to ensure interoperability between agency deployments of AI, to include data interoperability and data sharing agreements, as appropriate and consistent with applicable law;
    (D)  A process to maintain, update, and disseminate such trainings and best practices on an ongoing basis;
    (E)  AI-related policy initiatives to address regulatory gaps implicated by executive branch-wide policy development processes; and 
    (F)  An agile process to increase the speed of acquisitions, validation, and delivery of AI capabilities, consistent with applicable law.
    (iii)  Within 90 days of the date of this memorandum, the Coordination Group described in subsection (b)(ii) of this section shall establish a National Security AI Executive Talent Committee (Talent Committee) composed of senior AI officials (or designees) from all agencies in the Coordination Group that wish to participate.  The Talent Committee shall work to standardize, prioritize, and address AI talent needs and develop an updated set of Government-wide procedures for attracting, hiring, developing, and retaining AI and AI-enabling talent for national security purposes.  The Talent Committee shall designate a representative to serve as a member of the AI and Technology Talent Task Force set forth in Executive Order 14110, helping to identify overlapping needs and address shared challenges in hiring.
    (iv)   Within 365 days of the date of this memorandum, and annually thereafter for at least the next 5 years, the Coordination Group described in subsection (b)(ii) of this section shall issue a joint report to the APNSA on consolidation and interoperability of AI efforts and systems for the purposes of national security.
         Sec. 7.  Definitions.  (a)  This memorandum uses definitions set forth in section 3 of Executive Order 14110.  In addition, for the purposes of this memorandum:
    (i)     The term “AI safety” means the mechanisms through which individuals and organizations minimize and mitigate the potential for harm to individuals and society that can result from the malicious use, misapplication, failures, accidents, and unintended behavior of AI models; the systems that integrate them; and the ways in which they are used.
    (ii)    The term “AI security” means a set of practices to protect AI systems — including training data, models, abilities, and lifecycles — from cyber and physical attacks, thefts, and damage.
    (iii)   The term “covered agencies” means agencies in the Intelligence Community, as well as all agencies as defined in 44 U.S.C. 3502(1) when they use AI as a component of a National Security System, other than the Executive Office of the President.
    (iv)    The term “Critical Technical Artifacts” (CTAs) means information, usually specific to a single model or group of related models that, if possessed by someone other than the model developer, would substantially lower the costs of recreating, attaining, or using the model’s capabilities.  Under the technical paradigm dominant in the AI industry today, the model weights of a trained AI system constitute CTAs, as do, in some cases, associated training data and code.  Future paradigms may rely on different CTAs.
    (v)     The term “frontier AI model” means a general-purpose AI system near the cutting-edge of performance, as measured by widely accepted publicly available benchmarks, or similar assessments of reasoning, science, and overall capabilities.
    (vi)    The term “Intelligence Community” (IC) has the meaning provided in 50 U.S.C. 3003.
    (vii)   The term “open-weight model” means a model that has weights that are widely available, typically through public release.
    (viii)  The term “United States Government” means all agencies as defined in 44 U.S.C. 3502(1).
         Sec. 8.  General Provisions.  (a)  Nothing in this memorandum shall be construed to impair or otherwise affect:
    (i)   the authority granted by law to an executive department or agency, or the head thereof; or
    (ii)  the functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals.
         (b)  This memorandum shall be implemented consistent with applicable law and subject to the availability of appropriations.
         (c)  This memorandum is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
                                  JOSEPH R. BIDEN JR.

    MIL OSI USA News

  • MIL-OSI: Live Oak Bancshares, Inc. Reports Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    WILMINGTON, N.C., Oct. 23, 2024 (GLOBE NEWSWIRE) — Live Oak Bancshares, Inc. (NYSE: LOB) (“Live Oak” or “the Company”) today reported third quarter of 2024 net income of $13.0 million, or $0.28 per diluted share.

    “Live Oak delivered historic production levels this quarter as our teams continue to put capital into the hands of business owners across the country,” said Live Oak Chairman and Chief Executive Officer James S. (Chip) Mahan III. “We believe our business momentum is in an exciting place and our conservative approach to growth is driving positive operating leverage, revenue, and deeper customer relationships.”

    Third Quarter 2024 Key Measures

    (Dollars in thousands, except per share data)       Increase (Decrease)    
      3Q 2024   2Q 2024   Dollars   Percent   3Q 2023
    Total revenue(1) $ 129,932     $ 125,479     $ 4,453       3.5 %   $ 127,301  
    Total noninterest expense   77,589       77,656       (67 )     (0.1 )     74,262  
    Income before taxes   17,841       36,058       (18,217 )     (50.5 )     42,760  
    Effective tax rate   27.0 %     25.2 %     n/a       n/a       6.9 %
    Net income $ 13,025     $ 26,963     $ (13,938 )     (51.7 )%   $ 39,793  
    Diluted earnings per share   0.28       0.59       (0.31 )     (52.5 )     0.88  
    Loan and lease production:                  
    Loans and leases originated $ 1,757,856     $ 1,171,141     $ 586,715       50.1 %   $ 1,073,255  
    % Fully funded   42.4 %     38.2 %     n/a       n/a       52.2 %
    Total loans and leases: $ 10,191,868     $ 9,535,766     $ 656,102       6.9 %   $ 8,775,235  
    Total assets:   12,607,346       11,868,570       738,776       6.2       10,950,460  
    Total deposits:   11,400,547       10,707,031       693,516       6.5       10,003,642  

    (1) Total revenue consists of net interest income and total noninterest income.

    Loans and Leases

    As of September 30, 2024, the total loan and lease portfolio was $10.19 billion, 6.9% above its level at June 30, 2024, and 16.1% above its level a year ago. Excluding historical Paycheck Protection Program loans, the third quarter of 2024 was the Company’s highest loan production quarter of all time. Compared to the second quarter of 2024, loans and leases held for investment increased $659.8 million, or 7.2%, to $9.83 billion while loans held for sale decreased $3.7 million, or 1.0%, to $360.0 million. Average loans and leases were $9.76 billion during the third quarter of 2024 compared to $9.38 billion during the second quarter of 2024. 

    The total loan and lease portfolio at September 30, 2024, and June 30, 2024, was comprised of 34.5% and 36.4% of guaranteed loans, respectively.

    Loan and lease originations totaled $1.76 billion during the third quarter of 2024, an increase of $586.7 million, or 50.1%, from the second quarter of 2024. Loan and lease originations increased $684.6 million, or 63.8%, from the third quarter of 2023.

    Deposits

    Total deposits increased to $11.40 billion at September 30, 2024, an increase of $693.5 million compared to June 30, 2024, and an increase of $1.40 billion compared to September 30, 2023. The increase in total deposits from prior periods was to support growth in the loan and lease portfolio as well as the Company’s targeted liquidity levels.

    Average total interest-bearing deposits for the third quarter of 2024 increased $287.5 million, or 2.8%, to $10.56 billion, compared to $10.27 billion for the second quarter of 2024. The ratio of average total loans and leases to average interest-bearing deposits was 92.5% for the third quarter of 2024, compared to 91.4% for the second quarter of 2024.

    Borrowings

    Borrowings totaled $115.4 million at September 30, 2024 compared to $117.7 million and $25.8 million at June 30, 2024, and September 30, 2023, respectively. During the first quarter of 2024, the Company increased long-term borrowings by $100.0 million through an unsecured 5.95% fixed rate 60-month term loan with a third party correspondent bank. This increase in borrowings was to strategically enhance capital levels in order to accommodate future growth expectations.

    Net Interest Income

    Net interest income for the third quarter of 2024 was $97.0 million compared to $91.3 million for the second quarter of 2024 and $89.4 million for the third quarter of 2023. The net interest margin for the third quarter of 2024 and second quarter of 2024 was 3.33% and 3.28%, respectively, an increase of five basis points quarter over quarter. During the third quarter of 2024, the average cost of interest-bearing liabilities increased by two basis points, while the average yield on interest-earning assets increased by six basis points.

    The increase in net interest income for the third quarter of 2024 compared to the third quarter of 2023 was largely driven by growth in average loans and leases held for investment. Partially mitigating this increase was a decrease in the net interest margin by four basis points arising from an increase in deposits and borrowings, combined with the increase in average cost of funds, outpacing the increase in average yield on interest-earning assets.

    Noninterest Income

    Noninterest income for the third quarter of 2024 was $32.9 million, a decrease of $1.2 million compared to the second quarter of 2024, and a decrease of $5.0 million compared to the third quarter of 2023. The primary drivers in noninterest income changes are outlined below.

    The loan servicing asset revaluation resulted in a loss of $4.2 million for the third quarter of 2024 compared to a $11.3 million gain for the third quarter of 2023. This decrease between periods was principally due to the third quarter of 2023 change in valuation techniques used to estimate the fair value of servicing rights which resulted in a nonrecurring gain of $13.7 million during that period.

    Net gains on sales of loans was $16.6 million, a $2.3 million increase compared to the second quarter of 2024 and a $4.0 million increase compared to the third quarter of 2023. The increase in net gains on sales of loans for both compared periods was the result of higher levels of market premiums combined with increased loan sale volumes. The average guaranteed loan sale premium was 107%, 106% and 105% for the third and second quarters of 2024 and third quarter of 2023, respectively. The volume of guaranteed loans sold was $266.3 million for the third quarter of 2024 compared to $250.5 million sold in the second quarter of 2024 and $225.6 million sold in the third quarter of 2023.

    Loans accounted for under the fair value option had a net gain of $2.3 million for the third quarter of 2024, compared to a net gain of $172 thousand for the second quarter of 2024 and a net loss of $568 thousand for the third quarter of 2023. The increased levels of net gains arising from the valuation of loans accounted for under the fair value option compared to the second quarter of 2024 was largely associated with lower market interest rates. The increase in net gains when compared to the third quarter of 2023 was principally due to the third quarter of 2023 change in valuation techniques used to estimate the fair value of loans measured at fair value, which resulted in a nonrecurring gain of $1.3 million during that period.

    Management fee income decreased by $2.2 million, as compared to both the second quarter of 2024 and third quarter of 2023. This decrease was the result of a restructuring of the Canapi Funds in the third quarter of 2024. In connection with that restructuring, the Company’s subsidiary Canapi Advisors voluntarily withdrew as an advisor to the funds. The Company remains an investor in the Canapi Funds and continues its focus on new and emerging financial technology companies.

    Other noninterest income for the third quarter of 2024 totaled $7.1 million compared to $11.0 million for the second quarter of 2024 and $3.5 million for the third quarter of 2023. The quarter over quarter decrease of $3.9 million was largely related to a $6.7 million gain arising from the sale of one of the Company’s aircraft in the second quarter of 2024, partially offset by a $2.4 million gain from the sale of a building in the third quarter of 2024. The $3.6 million increase compared to the third quarter of 2023 was largely related to the above mentioned $2.4 million gain from the sale of an idle building and accompanying land that was determined earlier in 2024 not to be best suited to serve the Company’s future expansion plans.

    Noninterest Expense

    Noninterest expense for the third quarter of 2024 totaled $77.6 million compared to $77.7 million for the second quarter of 2024 and $74.3 million for the third quarter of 2023. Compared to the third quarter of 2023, the increase in noninterest expense was principally impacted by smaller balance increases in various expense categories, partially offset by $2.2 million in decreased levels of FDIC insurance expense. The decrease in FDIC insurance expense was the product of favorable changes in the Company’s FDIC assessment rates.

    Asset Quality

    During the third quarter of 2024, the Company recognized net charge-offs for loans carried at historical cost of $1.7 million, compared to $8.3 million in the second quarter of 2024 and $9.1 million in the third quarter of 2023. Net charge-offs as a percentage of average held for investment loans and leases carried at historical cost, annualized, for the quarters ended September 30, 2024, June 30, 2024, and September 30, 2023, was 0.08%, 0.38% and 0.48%, respectively.

    Unguaranteed nonperforming (nonaccrual) loans and leases, excluding $8.7 million and $9.6 million accounted for under the fair value option at September 30, 2024, and June 30, 2024, respectively, increased to $49.4 million, or 0.52% of loans and leases held for investment which are carried at historical cost, at September 30, 2024, compared to $37.3 million, or 0.42%, at June 30, 2024.

    Provision for Credit Losses

    The provision for credit losses for the third quarter of 2024 totaled $34.5 million compared to $11.8 million for the second quarter of 2024 and $10.3 million for the third quarter of 2023. The level of provision expense in the third quarter of 2024 was primarily the result of specific reserve increases on individually evaluated loans and continued growth of the loan and lease portfolio. Provision expense for three individually evaluated loan relationships amounted to $13.6 million, or 60.0% and 56.3% of the increase in the total provision for loan and lease losses when compared to the second quarter of 2024 and third quarter of 2023, respectively.

    The allowance for credit losses on loans and leases totaled $168.7 million at September 30, 2024, compared to $137.9 million at June 30, 2024. The allowance for credit losses on loans and leases as a percentage of total loans and leases held for investment carried at historical cost was 1.78% and 1.57% at September 30, 2024, and June 30, 2024, respectively.

    Income Tax

    Income tax expense and related effective tax rate was $4.8 million and 27.0% for the third quarter of 2024, $9.1 million and 25.2% for the second quarter of 2024 and $3.0 million and 6.9% for the third quarter of 2023, respectively. The lower level of income tax expense for the third quarter of 2024 compared to the second quarter of 2024 was primarily the result of the decreased level of pretax income. The higher level of income tax expense for the third quarter of 2024 as compared to the third quarter of 2023 was primarily the result of lower levels of anticipated investment tax credits in 2024 as compared to the prior year.

    Conference Call

    Live Oak will host a conference call to discuss the Company’s financial results and business outlook tomorrow, October 24, 2024, at 9:00 a.m. ET. The call will be accessible by telephone and webcast using Conference ID: 04478. A supplementary slide presentation will be posted to the website prior to the event, and a replay will be available for 12 months following the event. The conference call details are as follows:

    Live Telephone Dial-In

    U.S.: 800.549.8228
    International: +1 646.564.2877
    Pass Code: None Required

    Live Webcast Log-In

    Webcast Link: investor.liveoakbank.com
    Registration: Name and Email Required
    Multi-Factor Code: Provided After Registration

    Important Note Regarding Forward-Looking Statements

    Statements in this press release that are based on other than historical data or that express the Company’s plans or expectations regarding future events or determinations are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Statements based on historical data are not intended and should not be understood to indicate the Company’s expectations regarding future events. Forward-looking statements provide current expectations or forecasts of future events or determinations. These forward-looking statements are not guarantees of future performance or determinations, nor should they be relied upon as representing management’s views as of any subsequent date. Forward-looking statements involve significant risks and uncertainties, and actual results may differ materially from those presented, either expressed or implied, in this press release. Factors that could cause actual results to differ materially from those expressed in the forward-looking statements include changes in Small Business Administration (“SBA”) rules, regulations or loan products, including the Section 7(a) program, changes in SBA standard operating procedures or changes in Live Oak Banking Company’s status as an SBA Preferred Lender; changes in rules, regulations or procedures for other government loan programs, including those of the United States Department of Agriculture; the impacts of global health crises and pandemics, such as the Coronavirus Disease 2019 (COVID-19) pandemic, on trade (including supply chains and export levels), travel, employee productivity and other economic activities that may have a destabilizing and negative effect on financial markets, economic activity and customer behavior; adverse developments in the banking industry highlighted by high-profile bank failures and the potential impact of such developments on customer confidence, liquidity, and regulatory responses to these developments; a reduction in or the termination of the Company’s ability to use the technology-based platform that is critical to the success of its business model, including a failure in or a breach of operational or security systems or those of its third-party service providers; technological risks and developments, including cyber threats, attacks, or events; competition from other lenders; the Company’s ability to attract and retain key personnel; market and economic conditions and the associated impact on the Company; operational, liquidity and credit risks associated with the Company’s business; changes in political and economic conditions, including any prolonged U.S. government shutdown; the impact of heightened regulatory scrutiny of financial products and services and the Company’s ability to comply with regulatory requirements and expectations; a deterioration of the credit rating for U.S. long-term sovereign debt, actions that the U.S. government may take to avoid exceeding the debt ceiling, and uncertainties surrounding the debt ceiling and the federal budget; adverse results, including related fees and expenses, from pending or future lawsuits, government investigations or private actions; and the other factors discussed in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) and available at the SEC’s Internet site (http://www.sec.gov). Except as required by law, the Company specifically disclaims any obligation to update any factors or to publicly announce the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

    About Live Oak Bancshares, Inc.

    Live Oak Bancshares, Inc. (NYSE: LOB) is a financial holding company and the parent company of Live Oak Bank. Live Oak Bancshares and its subsidiaries partner with businesses that share a groundbreaking focus on service and technology to redefine banking. To learn more, visit www.liveoakbank.com.

    Contacts:

    Walter J. Phifer | CFO | Investor Relations | 910.202.6926
    Claire Parker | Corporate Communications | Media Relations | 910.597.1592

    Live Oak Bancshares, Inc.
    Quarterly Statements of Income (unaudited)
    (Dollars in thousands, except per share data)

      Three Months Ended   3Q 2024 Change vs.
      3Q 2024   2Q 2024   1Q 2024   4Q 2023   3Q 2023   2Q 2024   3Q 2023
    Interest income                     %   %
    Loans and fees on loans $ 192,170     $ 181,840     $ 176,010     $ 169,531     $ 162,722       5.7       18.1  
    Investment securities, taxable   9,750       9,219       8,954       8,746       8,701       5.8       12.1  
    Other interest earning assets   7,016       7,389       7,456       8,259       9,188       (5.0 )     (23.6 )
    Total interest income   208,936       198,448       192,420       186,536       180,611       5.3       15.7  
    Interest expense                          
    Deposits   110,174       105,358       101,998       96,695       90,914       4.6       21.2  
    Borrowings   1,762       1,770       311       265       287       (0.5 )     513.9  
    Total interest expense   111,936       107,128       102,309       96,960       91,201       4.5       22.7  
    Net interest income   97,000       91,320       90,111       89,576       89,410       6.2       8.5  
    Provision for credit losses   34,502       11,765       16,364       8,995       10,279       193.3       235.7  
    Net interest income after provision for credit losses   62,498       79,555       73,747       80,581       79,131       (21.4 )     (21.0 )
    Noninterest income                          
    Loan servicing revenue   8,040       7,347       7,624       7,342       6,990       9.4       15.0  
    Loan servicing asset revaluation   (4,207 )     (2,878 )     (2,744 )     (3,974 )     11,335       (46.2 )     (137.1 )
    Net gains on sales of loans   16,646       14,395       11,502       12,891       12,675       15.6       31.3  
    Net gain (loss) on loans accounted for under the fair value option   2,255       172       (219 )     (170 )     (568 )     1211.0       497.0  
    Equity method investments (loss) income   (1,393 )     (1,767 )     (5,022 )     47       (1,034 )     21.2       (34.7 )
    Equity security investments gains (losses), net   909       161       (529 )     (384 )     (783 )     464.6       216.1  
    Lease income   2,424       2,423       2,453       2,439       2,498             (3.0 )
    Management fee income   1,116       3,271       3,271       3,309       3,277       (65.9 )     (65.9 )
    Other noninterest income   7,142       11,035       9,761       8,607       3,501       (35.3 )     104.0  
    Total noninterest income   32,932       34,159       26,097       30,107       37,891       (3.6 )     (13.1 )
    Noninterest expense                          
    Salaries and employee benefits   44,524       46,255       47,275       44,274       42,947       (3.7 )     3.7  
    Travel expense   2,344       2,328       2,438       1,544       2,197       0.7       6.7  
    Professional services expense   3,287       3,061       1,878       3,052       1,762       7.4       86.5  
    Advertising and marketing expense   2,473       3,004       3,692       2,501       3,446       (17.7 )     (28.2 )
    Occupancy expense   2,807       2,388       2,247       2,231       2,129       17.5       31.8  
    Technology expense   9,081       7,996       7,723       8,402       7,722       13.6       17.6  
    Equipment expense   3,472       3,511       3,074       3,480       3,676       (1.1 )     (5.5 )
    Other loan origination and maintenance expense   4,872       3,659       3,911       3,937       3,498       33.2       39.3  
    Renewable energy tax credit investment impairment (recovery)   115       170       (927 )     14,575             (32.4 )     100.0  
    FDIC insurance   1,933       2,649       3,200       4,091       4,115       (27.0 )     (53.0 )
    Other expense   2,681       2,635       3,226       5,117       2,770       1.7       (3.2 )
    Total noninterest expense   77,589       77,656       77,737       93,204       74,262       (0.1 )     4.5  
    Income before taxes   17,841       36,058       22,107       17,484       42,760       (50.5 )     (58.3 )
    Income tax expense (benefit)   4,816       9,095       (5,479 )     1,321       2,967       (47.0 )     62.3  
    Net income $ 13,025     $ 26,963     $ 27,586     $ 16,163     $ 39,793       (51.7 )     (67.3 )
    Earnings per share                          
    Basic $ 0.28     $ 0.60     $ 0.62     $ 0.36     $ 0.89       (53.3 )     (68.5 )
    Diluted $ 0.28     $ 0.59     $ 0.60     $ 0.36     $ 0.88       (52.5 )     (68.2 )
    Weighted average shares outstanding                          
    Basic   45,073,482       44,974,942       44,762,308       44,516,646       44,408,997          
    Diluted   45,953,947       45,525,082       45,641,210       45,306,506       45,268,745          

    Live Oak Bancshares, Inc.
    Quarterly Balance Sheets (unaudited)
    (Dollars in thousands)

      As of the quarter ended   3Q 2024 Change vs.
      3Q 2024   2Q 2024   1Q 2024   4Q 2023   3Q 2023   2Q 2024   3Q 2023
    Assets                     %   %
    Cash and due from banks $ 666,585     $ 615,449     $ 597,394     $ 582,540     $ 534,774       8.3       24.6  
    Certificates of deposit with other banks   250       250       250       250       3,750             (93.3 )
    Investment securities available-for-sale   1,233,466       1,151,195       1,120,622       1,126,160       1,099,878       7.1       12.1  
    Loans held for sale   359,977       363,632       310,749       387,037       572,604       (1.0 )     (37.1 )
    Loans and leases held for investment(1)   9,831,891       9,172,134       8,912,561       8,633,847       8,202,631       7.2       19.9  
    Allowance for credit losses on loans and leases   (168,737 )     (137,867 )     (139,041 )     (125,840 )     (121,273 )     (22.4 )     (39.1 )
    Net loans and leases   9,663,154       9,034,267       8,773,520       8,508,007       8,081,358       7.0       19.6  
    Premises and equipment, net   267,032       267,864       258,071       257,881       258,041       (0.3 )     3.5  
    Foreclosed assets   8,015       8,015       8,561       6,481       6,701             19.6  
    Servicing assets   52,553       51,528       49,343       48,591       47,127       2.0       11.5  
    Other assets   356,314       376,370       387,059       354,476       346,227       (5.3 )     2.9  
    Total assets $ 12,607,346     $ 11,868,570     $ 11,505,569     $ 11,271,423     $ 10,950,460       6.2       15.1  
    Liabilities and shareholders’ equity                          
    Liabilities                          
    Deposits:                          
    Noninterest-bearing $ 258,844     $ 264,013     $ 226,668     $ 259,270     $ 239,536       (2.0 )     8.1  
    Interest-bearing   11,141,703       10,443,018       10,156,693       10,015,749       9,764,106       6.7       14.1  
    Total deposits   11,400,547       10,707,031       10,383,361       10,275,019       10,003,642       6.5       14.0  
    Borrowings   115,371       117,745       120,242       23,354       25,847       (2.0 )     346.4  
    Other liabilities   83,672       82,745       74,248       70,384       70,603       1.1       18.5  
    Total liabilities   11,599,590       10,907,521       10,577,851       10,368,757       10,100,092       6.3       14.8  
    Shareholders’ equity                          
    Preferred stock, no par value, 1,000,000 shares authorized, none issued or outstanding                                        
    Class A common stock (voting)   361,925       356,381       349,648       344,568       340,929       1.6       6.2  
    Class B common stock (non-voting)                                        
    Retained earnings   707,026       695,172       669,307       642,817       627,759       1.7       12.6  
    Accumulated other comprehensive loss   (61,195 )     (90,504 )     (91,237 )     (84,719 )     (118,320 )     32.4       48.3  
    Total shareholders’ equity   1,007,756       961,049       927,718       902,666       850,368       4.9       18.5  
    Total liabilities and shareholders’ equity $ 12,607,346     $ 11,868,570     $ 11,505,569     $ 11,271,423     $ 10,950,460       6.2       15.1  

    (1) Includes $343.4 million, $363.0 million, $379.2 million, $388.0 million and $410.1 million measured at fair value for the quarters ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 30, 2023, respectively.

     

    Live Oak Bancshares, Inc.
    Statements of Income (unaudited)
    (Dollars in thousands, except per share data)

      Nine Months Ended
      September 30, 2024   September 30, 2023
    Interest income      
    Loans and fees on loans $ 550,020     $ 454,136  
    Investment securities, taxable   27,923       24,751  
    Other interest earning assets   21,861       22,852  
    Total interest income   599,804       501,739  
    Interest expense      
    Deposits   317,530       243,512  
    Borrowings   3,843       2,498  
    Total interest expense   321,373       246,010  
    Net interest income   278,431       255,729  
    Provision for credit losses   62,631       42,328  
    Net interest income after provision for credit losses   215,800       213,401  
    Noninterest income      
    Loan servicing revenue   23,011       20,057  
    Loan servicing asset revaluation   (9,829 )     8,860  
    Net gains on sales of loans   42,543       33,654  
    Net gain (loss) on loans accounted for under the fair value option   2,208       (3,369 )
    Equity method investments (loss) income   (8,182 )     (6,041 )
    Equity security investments gain (losses), net   541       (585 )
    Lease income   7,300       7,568  
    Management fee income   7,658       10,015  
    Other noninterest income   27,938       11,467  
    Total noninterest income   93,188       81,626  
    Noninterest expense      
    Salaries and employee benefits   138,054       130,778  
    Travel expense   7,110       7,378  
    Professional services expense   8,226       4,685  
    Advertising and marketing expense   9,169       10,058  
    Occupancy expense   7,442       6,259  
    Technology expense   24,800       23,456  
    Equipment expense   10,057       11,517  
    Other loan origination and maintenance expense   12,442       10,867  
    Renewable energy tax credit investment (recovery) impairment   (642 )     69  
    FDIC insurance   7,782       12,579  
    Other expense   8,542       12,035  
    Total noninterest expense   232,982       229,681  
    Income before taxes   76,006       65,346  
    Income tax expense   8,432       7,611  
    Net income $ 67,574     $ 57,735  
    Earnings per share      
    Basic $ 1.50     $ 1.30  
    Diluted $ 1.48     $ 1.28  
    Weighted average shares outstanding      
    Basic   44,937,409       44,298,798  
    Diluted   45,707,245       45,023,739  

    Live Oak Bancshares, Inc.
    Quarterly Selected Financial Data
    (Dollars in thousands, except per share data)

      As of and for the three months ended
      3Q 2024   2Q 2024   1Q 2024   4Q 2023   3Q 2023
    Income Statement Data                  
    Net income $ 13,025     $ 26,963     $ 27,586     $ 16,163     $ 39,793  
    Per Common Share                  
    Net income, diluted $ 0.28     $ 0.59     $ 0.60     $ 0.36     $ 0.88  
    Dividends declared   0.03       0.03       0.03       0.03       0.03  
    Book value   22.32       21.35       20.64       20.23       19.12  
    Tangible book value(1)   22.24       21.28       20.57       20.15       19.04  
    Performance Ratios                  
    Return on average assets (annualized)   0.43 %     0.93 %     0.98 %     0.58 %     1.46 %
    Return on average equity (annualized)   5.21       11.39       11.93       7.36       18.68  
    Net interest margin   3.33       3.28       3.33       3.32       3.37  
    Efficiency ratio(1)   59.72       61.89       66.89       77.88       58.34  
    Noninterest income to total revenue   25.35       27.22       22.46       25.16       29.76  
    Selected Loan Metrics                  
    Loans and leases originated $ 1,757,856     $ 1,171,141     $ 805,129     $ 981,703     $ 1,073,255  
    Outstanding balance of sold loans serviced   4,452,750       4,292,857       4,329,097       4,238,328       4,028,575  
    Asset Quality Ratios                  
    Allowance for credit losses to loans and leases held for investment(3)   1.78 %     1.57 %     1.63 %     1.53 %     1.56 %
    Net charge-offs(3) $ 1,710     $ 8,253     $ 3,163     $ 4,428     $ 9,122  
    Net charge-offs to average loans and leases held for investment(2) (3)   0.08 %     0.38 %     0.15 %     0.22 %     0.48 %
                       
    Nonperforming loans and leases at historical cost(3)                  
    Unguaranteed $ 49,398     $ 37,340     $ 43,117     $ 39,285     $ 33,255  
    Guaranteed   166,177       122,752       105,351       95,678       65,837  
    Total   215,575       160,092       148,468       134,963       99,092  
    Unguaranteed nonperforming historical cost loans and leases, to loans and leases held for investment(3)   0.52 %     0.42 %     0.51 %     0.48 %     0.43 %
                       
    Nonperforming loans at fair value(4)                  
    Unguaranteed $ 8,672     $ 9,590     $ 7,942     $ 7,230     $ 6,518  
    Guaranteed   49,822       51,570       47,620       41,244       39,378  
    Total   58,494       61,160       55,562       48,474       45,896  
    Unguaranteed nonperforming fair value loans to fair value loans held for investment(4)   2.53 %     2.64 %     2.09 %     1.86 %     1.59 %
                       
    Capital Ratios                  
    Common equity tier 1 capital (to risk-weighted assets)   11.19 %     11.85 %     11.89 %     11.73 %     11.63 %
    Tier 1 leverage capital (to average assets)   8.60       8.71       8.69       8.58       8.56  

    Notes to Quarterly Selected Financial Data
    (1) See accompanying GAAP to Non-GAAP Reconciliation.
    (2) Quarterly net charge-offs as a percentage of quarterly average loans and leases held for investment, annualized.
    (3) Loans and leases at historical cost only (excludes loans measured at fair value).
    (4) Loans accounted for under the fair value option only (excludes loans and leases carried at historical cost).

    Live Oak Bancshares, Inc.
    Quarterly Average Balances and Net Interest Margin
    (Dollars in thousands)

      Three Months Ended
    September 30, 2024
      Three Months Ended
    June 30, 2024
      Average Balance   Interest   Average Yield/Rate   Average Balance   Interest   Average Yield/Rate
    Interest-earning assets:                      
    Interest-earning balances in other banks $ 519,340     $ 7,016       5.37 %   $ 555,570     $ 7,389       5.35 %
    Investment securities   1,287,410       9,750       3.01       1,263,675       9,219       2.93  
    Loans held for sale   409,902       9,859       9.57       387,824       9,329       9.67  
    Loans and leases held for investment(1)   9,354,522       182,311       7.75       8,997,164       172,511       7.71  
    Total interest-earning assets   11,571,174       208,936       7.18       11,204,233       198,448       7.12  
    Less: Allowance for credit losses on loans and leases   (137,285 )             (136,668 )        
    Noninterest-earning assets   567,098               562,488          
    Total assets $ 12,000,987             $ 11,630,053          
    Interest-bearing liabilities:                      
    Interest-bearing checking $ 350,239     $ 4,892       5.56 %   $ 304,505     $ 4,267       5.64 %
    Savings   5,043,930       51,516       4.06       4,804,037       48,617       4.07  
    Money market accounts   134,481       190       0.56       128,625       186       0.58  
    Certificates of deposit   5,028,830       53,576       4.24       5,032,856       52,288       4.18  
    Total deposits   10,557,480       110,174       4.15       10,270,023       105,358       4.13  
    Borrowings   116,925       1,762       6.00       119,321       1,770       5.97  
    Total interest-bearing liabilities   10,674,405       111,936       4.17       10,389,344       107,128       4.15  
    Noninterest-bearing deposits   237,387               223,026          
    Noninterest-bearing liabilities   90,079               70,667          
    Shareholders’ equity   999,116               947,016          
    Total liabilities and shareholders’ equity $ 12,000,987             $ 11,630,053          
    Net interest income and interest rate spread     $ 97,000       3.01 %       $ 91,320       2.97 %
    Net interest margin           3.33               3.28  
    Ratio of average interest-earning assets to average interest-bearing liabilities           108.40 %             107.84 %

    (1) Average loan and lease balances include non-accruing loans and leases.

    Live Oak Bancshares, Inc.
    GAAP to Non-GAAP Reconciliation
    (Dollars in thousands)

      As of and for the three months ended
      3Q 2024   2Q 2024   1Q 2024   4Q 2023   3Q 2023
    Total shareholders’ equity $ 1,007,756     $ 961,049     $ 927,718     $ 902,666     $ 850,368  
    Less:                  
    Goodwill   1,797       1,797       1,797       1,797       1,797  
    Other intangible assets   1,606       1,644       1,682       1,721       1,759  
    Tangible shareholders’ equity (a) $ 1,004,353     $ 957,608     $ 924,239     $ 899,148     $ 846,812  
    Shares outstanding (c)   45,151,691       45,003,856       44,938,673       44,617,673       44,480,215  
    Total assets $ 12,607,346     $ 11,868,570     $ 11,505,569     $ 11,271,423     $ 10,950,460  
    Less:                  
    Goodwill   1,797       1,797       1,797       1,797       1,797  
    Other intangible assets   1,606       1,644       1,682       1,721       1,759  
    Tangible assets (b) $ 12,603,943     $ 11,865,129     $ 11,502,090     $ 11,267,905     $ 10,946,904  
    Tangible shareholders’ equity to tangible assets (a/b)   7.97 %     8.07 %     8.04 %     7.98 %     7.74 %
    Tangible book value per share (a/c) $ 22.24     $ 21.28     $ 20.57     $ 20.15     $ 19.04  
    Efficiency ratio:                  
    Noninterest expense (d) $ 77,589     $ 77,656     $ 77,737     $ 93,204     $ 74,262  
    Net interest income   97,000       91,320       90,111       89,576       89,410  
    Noninterest income   32,932       34,159       26,097       30,107       37,891  
    Total revenue (e) $ 129,932     $ 125,479     $ 116,208     $ 119,683     $ 127,301  
    Efficiency ratio (d/e)   59.72 %     61.89 %     66.89 %     77.88 %     58.34 %
    Pre-provision net revenue (e-d) $ 52,343     $ 47,823     $ 38,471     $ 26,479     $ 53,039  
                                           

    This press release presents non-GAAP financial measures. The adjustments to reconcile from the non-GAAP financial measures to the applicable GAAP financial measure are included where applicable in financial results presented in accordance with GAAP. The Company considers these adjustments to be relevant to ongoing operating results. The Company believes that excluding the amounts associated with these adjustments to present the non-GAAP financial measures provides a meaningful base for period-to-period comparisons, which will assist regulators, investors, and analysts in analyzing the operating results or financial position of the Company. The non-GAAP financial measures are used by management to assess the performance of the Company’s business, for presentations of Company performance to investors, and for other reasons as may be requested by investors and analysts. The Company further believes that presenting the non-GAAP financial measures will permit investors and analysts to assess the performance of the Company on the same basis as that applied by management. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. Although non-GAAP financial measures are frequently used by shareholders to evaluate a company, they have limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of results reported under GAAP.

    The MIL Network

  • MIL-OSI: CVB Financial Corp. Reports Earnings for the Third Quarter 2024

    Source: GlobeNewswire (MIL-OSI)

    Third Quarter 2024

    • Net Earnings of $51 million, or $0.37 per share
    • Return on Average Assets of 1.23%
    • Return on Average Tangible Common Equity of 14.93%
    • Net Interest Margin of 3.05%

    Ontario, CA, Oct. 23, 2024 (GLOBE NEWSWIRE) — CVB Financial Corp. (NASDAQ:CVBF) and its subsidiary, Citizens Business Bank (the “Company”), announced earnings for the quarter ended September 30, 2024.

    CVB Financial Corp. reported net income of $51.2 million for the quarter ended September 30, 2024, compared with $50.0 million for the second quarter of 2024 and $57.9 million for the third quarter of 2023. Diluted earnings per share were $0.37 for the third quarter, compared to $0.36 for the prior quarter and $0.42 for the same period last year. Net income of $51.2 million for the third quarter of 2024 produced an annualized return on average equity (“ROAE”) of 9.40%, an annualized return on average tangible common equity (“ROATCE”) of 14.93%, and an annualized return on average assets (“ROAA”) of 1.23%.

    David Brager, President and Chief Executive Officer of Citizens Business Bank, commented, “We are pleased with our third quarter results. The Bank continues to execute on our strategy of banking the best small to medium sized businesses in the markets we serve. The results in the third quarter represent our 190th consecutive quarter of profitability. I am very proud of the commitment of our associates to our mission and the loyalty of our customers to our shared vision of success.“

    Highlights for the Third Quarter of 2024

    • Net interest margin of 3.05%
    • Efficiency Ratio of 46.5%
    • TCE Ratio = 9.7% & CET1 Ratio > 15%
    • Net income grew by 2.4%, compared to the second quarter of 2024
    • Deposits and customer repurchase agreements increased $408 million compared to the end of the second quarter of 2024
    • Noninterest-bearing deposits were 59% of total deposits
    • Early redemption of $1.3 billion of Bank Term Funding Program borrowings
    • Sold $312 million in AFS securities for a loss of $11.6 million
    • Executed the sale and leaseback of two buildings generating gains of $9.1 million
    • Loans declined by $109 million, or 1.3% from the end of the second quarter of 2024
    • Net recoveries were $156,000 for the third quarter of 2024

    INCOME STATEMENT HIGHLIGHTS

      Three Months Ended   Nine Months Ended  
      September 30,
    2024

        June 30,
    2024

        September 30,
    2023

        September 30,
    2024

        September 30,
    2023

       
      (Dollars in thousands, except per share amounts)
    Net interest income $ 113,619     $ 110,849     $ 123,371     $ 336,929     $ 368,634    
    Recapure of (provision for) credit losses               (2,000 )           (4,000 )  
    Noninterest income   12,834       14,424       14,309       41,371       40,167    
    Noninterest expense   (58,835 )     (56,497 )     (55,058 )     (175,103 )     (163,956 )  
    Income taxes   (16,394 )     (18,741 )     (22,735 )     (53,339 )     (67,918 )  
    Net earnings $ 51,224     $ 50,035     $ 57,887     $ 149,858     $ 172,927    
    Earnings per common share:                  
    Basic $ 0.37     $ 0.36     $ 0.42     $ 1.07     $ 1.24    
    Diluted $ 0.37     $ 0.36     $ 0.42     $ 1.07     $ 1.24    
                       
    NIM   3.05 %     3.05 %     3.31 %     3.06 %     3.32 %  
    ROAA   1.23 %     1.24 %     1.40 %     1.23 %     1.41 %  
    ROAE   9.40 %     9.57 %     11.33 %     9.43 %     11.50 %  
    ROATCE   14.93 %     15.51 %     18.82 %     15.19 %     19.24 %  
    Efficiency ratio   46.53 %     45.10 %     39.99 %     46.29 %     40.11 %  

    Net Interest Income
    Net interest income was $113.6 million for the third quarter of 2024. This represented a $2.8 million, or 2.50%, increase from the second quarter of 2024, and a $9.8 million, or 7.90%, decrease from the third quarter of 2023. The quarter-over-quarter increase in net interest income was primarily due to a $7.0 million increase in interest income resulting from a $513 million average increase in our interest-earning balances due from the Federal Reserve, partially offset by a $3.8 million increase in interest on deposits. The decline in net interest income compared to the third quarter of 2023 was primarily due to a 26 basis point decline in net interest margin.

    Net Interest Margin
    Our tax equivalent net interest margin was 3.05% for both the second and third quarters of 2024, compared to 3.31% for the third quarter of 2023. Our cost of funds compared to the second quarter of 2024 increased nine basis points, which was offset by a six basis point increase in our interest-earning asset yield. The six basis point increase in our interest-earning asset yield was due to a five basis point increase in loan yields and funds on deposit at the Federal Reserve increasing as a percentage of earnings assets to 8.2%, from 4.8% in the prior quarter. Average funds held at the Federal Reserve of $1.22 billion, grew by $513 million from the second quarter of 2024, earning 5.4% on average for the third quarter. Our cost of funds increased in the third quarter to 1.47%, as our cost of deposits and customer repurchase agreements increased by 14 basis points to 1.01%. The cost of interest-bearing non-maturity deposits increased from the prior quarter by 22 basis points. On average, borrowings decreased by $121 million compared to the second quarter, while continuing to have an average cost of 4.77%. The 26 basis point decrease in net interest margin compared to the third quarter of 2023, was primarily the result of a 55 basis point increase in cost of funds. This increase in cost of funds from the prior year quarter was the result of a 46 basis point increase in the cost of deposits and an increase in the level of borrowings, which grew on average by $411 million. A 25 basis point increase in earning asset yields over the prior year quarter partially offset the increase in funding costs. The higher earning asset yields, included higher loan yields, which grew from 5.07% for the third quarter of 2023 to 5.31% for the third quarter of 2024. The higher earning asset yield was also the result of the increase in average funds held at the Federal Reserve, which grew from 3.1% of earning assets in the third quarter of 2023 to 8.2% in the third quarter of 2024.

    Earning Assets and Deposits
    On average, total earning assets grew by $262 million, or 1.79%, quarter-over-quarter. This growth includes the $513 million increase in average funds on deposit at the Federal Reserve. Investment securities and loans declined on average by $126.9 million and $126.3 million, respectively, when compared to the second quarter of 2024. The decline in investment securities includes the impact of selling approximately $300 million of AFS securities during the third quarter. Compared to the third quarter of 2023, the mix of assets changed modestly, with the average balance of investment securities decreasing by $462.6 million, declining from 37% to 34% of total earning assets. Conversely, the average amount of funds held at the Federal Reserve increased by $748.8 million, growing from 3.1% of total earning assets in the third quarter of 2023 to 8.2% for the third quarter of 2024. Noninterest-bearing deposits declined on average by $28.4 million, or 0.40%, from the second quarter of 2024 and interest-bearing deposits and customer repurchase agreements increased on average by $279.2 million. Compared to the third quarter of 2023, total deposits and customer repurchase agreements declined on average by $503.7 million, or 3.90%, including a decline of $688 million, or 8.8%, in noninterest-bearing deposits. Non-maturity interest-bearing deposits and customer repurchase agreements decreased by $247.5 million on average, while time deposits grew on average by $431.9 million. On average, noninterest-bearing deposits were 59.10% of total deposits during the most recent quarter, compared to 60.20% for the second quarter of 2024 and 62.09% for the third quarter of 2023.

        Three Months Ended  
    SELECTED FINANCIAL HIGHLIGHTS September 30, 2024   June 30, 2024   September 30, 2023  
        (Dollars in thousands)  
    Yield on average investment securities (TE)   2.67 %     2.71 %     2.64 %  
    Yield on average loans   5.31 %     5.26 %     5.07 %  
    Yield on average earning assets (TE)   4.43 %     4.37 %     4.18 %  
    Cost of deposits   0.98 %     0.88 %     0.52 %  
    Cost of funds   1.47 %     1.38 %     0.92 %  
    Net interest margin (TE)   3.05 %     3.05 %     3.31 %  
                               
    Average Earning Asset Mix Avg   % of Total   Avg   % of Total   Avg   % of Total
      Total investment securities $ 5,080,033   34.01 %   $ 5,206,959   35.49 %   $ 5,542,590   37.20 %  
      Interest-earning deposits with other institutions   1,232,551   8.25 %     716,916   4.89 %     473,391   3.18 %  
      Loans   8,605,270   57.61 %     8,731,587   59.51 %     8,862,462   59.48 %  
      Total interest-earning assets   14,935,866         14,673,474         14,900,003      

    Provision for Credit Losses
    There was no provision for credit losses in the third and second quarter of 2024, compared to $2.0 million in provision in the third quarter of 2023. Net recoveries for the third quarter of 2024 were $156,000, compared to net charge-offs $31,000 in the prior quarter. Allowance for credit losses represented 0.97% of gross loans at September 30, 2024, compared to 0.95% at June 30, 2024.

    Noninterest Income
    Noninterest income was $12.8 million for the third quarter of 2024, compared with $14.4 million for the second quarter of 2024 and $14.3 million for the third quarter of 2023. During the third quarter of 2024, the Bank executed sale-leaseback transactions with the sale of two buildings, which operate as Banking Centers, and were simultaneously leased back, resulting in a pre-tax net gain of $9.1 million. The gains on selling the buildings were offset by realizing a pre-tax net loss of $11.6 million on the sale of $312 million of AFS securities. Third quarter income from Bank Owned Life Insurance (“BOLI”) increased by $557,000 from the second quarter of 2024 and increased by $2 million compared to the third quarter of 2023. We experienced $320,000 in death benefits that exceeded the asset value on certain policies in the third quarter of 2024, compared to no death benefits in the second quarter of 2024 and no death benefits in the third quarter of 2023. The year-over-year increase of $2 million in BOLI income was primarily due to the restructuring and enhancements in BOLI policies during the fourth quarter of 2023. Trust and investment service fees grew by 4.0% or $137,000 compared to the prior quarter and by 9.8% or $319,000 compared to the third quarter of 2023.  

    Noninterest Expense
    Noninterest expense for the third quarter of 2024 was $58.8 million, compared to $56.5 million for the second quarter of 2024 and $55.0 million for the third quarter of 2023. The $2.3 million quarter-over-quarter increase included a $1.2 million increase in staff related expense, as annual salary increases took effect in July. The $690,000 quarter-over-quarter increase in regulatory assessments was due to the $700,000 accrual adjustment in the second quarter of 2024 related the FDIC special assessment. There was a $750,000 recapture of provision for unfunded loan commitments in the third quarter of 2024, compared to a $500,000 recapture of provision in the second quarter of 2024 and $900,000 recaptured in the third quarter of 2023. Occupancy and equipment expense grew by $432,000 or 7%, compared to the prior quarter, including the impact of the two buildings that were sold and leased back during the third quarter.

    The $3.8 million increase in noninterest expense year-over-year included increased staff related expenses of $1.9 million, or 5.48%. Professional services increased $738,000, including a $627,000 increase in legal expense year-over-year. Occupancy and equipment expense increased by $586,000, or 10.43% and software expense increased $258,000, or 7% year-over-year. As a percentage of average assets, noninterest expense was 1.42% for the third quarter of 2024, compared to 1.40% for the second quarter of 2024 and 1.33% for the third quarter of 2023. The efficiency ratio for the third quarter of 2024 was 46.53%, compared to 45.10% for the second quarter of 2024 and 39.99% for the third quarter of 2023.  

    Income Taxes
    Our effective tax rate for the nine months ended September 30, 2024 was 26.25%, compared with 28.20% for the same period of 2023. Our estimated annual effective tax rate can vary depending upon the level of tax-advantaged income from municipal securities and BOLI, as well as available tax credits.

    BALANCE SHEET HIGHLIGHTS

    Assets
    The Company reported total assets of $15.4 billion at September 30, 2024. This represented a decrease of $748.3 million, or 4.63%, from total assets of $16.15 billion at June 30, 2024. The decrease in assets included a $416.9 million decrease in interest-earning balances due from the Federal Reserve, a $304.8 million decrease in investment securities, and a $109.4 million decrease in net loans.

    Total assets decreased by $617.8 million, or 3.86%, from total assets of $16.02 billion at December 31, 2023. The decrease in assets included a $549.9 million decrease in investment securities, and a $328.4 million decrease in net loans, partially offset by a $142.9 million increase in interest-earning balances due from the Federal Reserve.

    Total assets at September 30, 2024 decreased by $499.8 million, or 3.14%, from total assets of $15.90 billion at September 30, 2023. The decrease in assets was primarily due to a $491.8 million decrease in investment securities and a $299.0 million decrease in net loans, partially offset by an increase of $188.6 million in interest-earning balances due from the Federal Reserve and a $57.1 million increase in the cash surrender value of BOLI.

    Sale-Leaseback Transaction
    During the third quarter of 2024, the Bank executed sale-leaseback transactions and sold two buildings, that are utilized as Banking Centers, for an aggregate sale price of $17 million. The Bank simultaneously entered into lease agreements with the respective purchasers for initial terms of 15 and 18 years. These sale-leaseback transactions resulted in a pre-tax net gain of $9.1 million for the third quarter of 2024. The Bank also recorded Right of Use (“ROU”) assets and corresponding operating lease liabilities each totaling $11.2 million.

    Investment Securities and BOLI
    Total investment securities were $4.87 billion at September 30, 2024, a decrease of $549.9 million, or 10.14% from December 31, 2023, and a decrease of $491.8 million, or 9.17%, from $5.36 billion at September 30, 2023.  

    At September 30, 2024, investment securities available-for-sale (“AFS”) totaled $2.47 billion, inclusive of a pre-tax net unrealized loss of $367.7 million. AFS securities decreased by $280.2 million from the prior quarter end, by $490.5 million, or 16.59%, from December 31, 2023 and decreased by $407.6 million, or 14.19%, from $2.87 billion at September 30, 2023. Pre-tax unrealized loss decreased by $120.2 million from the end of the prior quarter, and declined by $82.1 million from December 31, 2023 and by $260.7 million from September 30, 2023.

    Concurrent with the sale-leaseback transactions during the third quarter of 2024, the Bank sold AFS securities with a book value of $312 million, resulting in a net pre-tax loss of $11.6 million.

    At September 30, 2024, investment securities held-to-maturity (“HTM”) totaled $2.41 billion, a decrease of $24.6 million from the prior quarter end, a $59.4 million, or 2.41% decline from December 31, 2023, and a decrease of $84.2 million, or 3.38%, from September 30, 2023.

    Combined, the AFS and HTM investments in mortgage backed securities (“MBS”) and collateralized mortgage obligations (“CMO”) totaled $3.82 billion or approximately 78% of the total investment securities at September 30, 2024. Virtually all of our MBS and CMO are issued or guaranteed by government or government sponsored enterprises, which have the implied guarantee of the U.S. Government. In addition, at September 30, 2024, we had $552.6 million of Government Agency securities that represent approximately 11.3% of the total investment securities.

    Our combined AFS and HTM municipal securities totaled $485.7 million as of September 30, 2024, or 10% of our total investment portfolio. These securities are located in 35 states. Our largest concentrations of holdings by state, as a percentage of total municipal bonds, are located in Texas at 16.09%, Minnesota at 11.07%, and California at 9.71%.

    At September 30, 2024, the Company had $316.6 million of Bank Owned Life insurance (“BOLI”), compared to $308.7 million at December 31, 2023 and $259.5 million at September 30, 2023. The $57.1 million increase in value of BOLI, when compared to September 30, 2023, was primarily due to a restructuring of the Company’s life insurance policies at the end of 2023, including a $4.5 million write-down in value on surrender policies that was offset by a $10.9 million enhancement to cash surrender values, as well as additional policy purchases totaling $41 million. This restructuring has increased returns on our BOLI policies resulting in additional non-taxable noninterest income in 2024.

    Loans
    Total loans and leases, at amortized cost, of $8.57 billion at September 30, 2024 decreased by $109.3 million, or 1.26%, from June 30, 2024. The quarter-over quarter decrease in loans included decreases of $46.3 million in commercial real estate loans, $37.5 million in construction loans, $19.7 million in commercial and industrial loans, and $8.1 million in dairy & livestock and agribusiness loans.

    Total loans and leases, at amortized cost, decreased by $332.3 million, or 3.73%, from December 31, 2023. The decrease in total loans included decreases of $165.9 million in commercial real estate loans, $70.5 million in dairy & livestock and agribusiness loans, $52.0 million in construction loans, and $33.4 million in commercial and industrial loans.

    Total loans and leases, at amortized cost, decreased by $305.1 million, or 3.44%, from September 30, 2023. The $305.1 million decrease included decreases of $224.4 million in commercial real estate loans, $48.3 million in construction loans, $13.1 million in SBA loans, $9.0 million in dairy & livestock and agribusiness loans, and $8.0 million in municipal lease financings.

    Asset Quality
    During the third quarter of 2024, we experienced credit charge-offs of $26,000 and total recoveries of $182,000, resulting in net recoveries of $156,000. The allowance for credit losses (“ACL”) totaled $82.9 million at September 30, 2024, compared to $82.8 million at June 30, 2024 and $89.0 million at September 30, 2023. At September 30, 2024, ACL as a percentage of total loans and leases outstanding was 0.97%. This compares to 0.95% at June 30, 2024 and 0.98% at December 31, 2023 and 1.00% at September 30, 2023.

    Nonperforming loans, defined as nonaccrual loans, including modified loans on nonaccrual, plus loans 90 days past due and accruing interest, and nonperforming assets, defined as nonperforming plus OREO, are highlighted below.

    Nonperforming Assets and Delinquency Trends September 30,
    2024
      June 30,
    2024
      September 30,
    2023
       
               
    Nonperforming loans   (Dollars in thousands)    
    Commercial real estate   $ 18,794     $ 21,908     $ 3,655      
    SBA     151       337       1,050      
    Commercial and industrial     2,825       2,712       4,672      
    Dairy & livestock and agribusiness     143             243      
    SFR mortgage                 339      
    Consumer and other loans                 4      
    Total   $ 21,913     $ 24,957     $ 9,963   [1]  
    % of Total loans     0.26 %     0.29 %     0.11 %    
    OREO                
    Commercial real estate   $     $     $      
    Commercial and industrial     647       647            
    SFR mortgage                      
    Total   $ 647     $ 647     $      
                     
    Total nonperforming assets   $ 22,560     $ 25,604     $ 9,963      
    % of Nonperforming assets to total assets     0.15 %     0.16 %     0.06 %    
                     
    Past due 30-89 days (accruing)                
    Commercial real estate   $ 30,701     $ 43     $ 136      
    SBA                      
    Commercial and industrial     64       103            
    Dairy & livestock and agribusiness                      
    SFR mortgage                      
    Consumer and other loans                      
    Total   $ 30,765     $ 146     $ 136      
    % of Total loans     0.36 %     0.00 %     0.00 %    
                     
    Classified Loans   $ 124,606     $ 124,728     $ 92,246      
         
    [1] Includes $2.6 million of nonaccrual loans past due 30-89 days.    

    The $3.0 million decrease in nonperforming loans from June 30, 2024 was primarily due to the payoff of one nonperforming commercial real estate loans totaling $2.3 million and $1.4 million in paydowns of nonperforming commercial real estate loans associated with two relationships. Past due loans grew to more than $30 million on September 30, 2024. Classified loans are loans that are graded “substandard” or worse. Classified loans decreased $122,000 quarter-over-quarter, primarily due to a $668,000 net decrease in classified commercial real estate loans, which included the payoff of 4 loans totaling $11.5 million that were partially offset by the addition of six classified commercial real estate loans in the third quarter of 2024. Classified dairy & livestock and agribusiness loans declined by $3.5 million due to paydowns and classified commercial and industrial loans increased $3.5 million primarily due to the addition of one classified commercial and industrial loan.

    Deposits & Customer Repurchase Agreements
    Deposits of $12.07 billion and customer repurchase agreements of $394.5 million totaled $12.47 billion at September 30, 2024. This represented a net increase of $407.9 million compared to June 30, 2024. Total deposits at September 30, 2024 included $400 million in brokered time deposits. Total deposits and customer repurchase agreements increased $761.7 million, or 6.51%, when compared to $11.71 billion at December 31, 2023 partially due to the growth in brokered deposits, and decreased $161.3 million, or 1.28% when compared to $12.63 billion at September 30, 2023.

    Noninterest-bearing deposits were $7.14 billion at September 30, 2024, an increase of $46.7 million, or 0.66%, when compared to $7.09 billion at June 30, 2024. Noninterest-bearing deposits decreased by $69.4 million, or 0.96% when compared to $7.21 billion at December 31, 2023, and decreased by $449.8 million, or 5.93% when compared to $7.59 billion at September 30, 2023. At September 30, 2024, noninterest-bearing deposits were 59.12% of total deposits, compared to 60.13% at June 30, 2024, 63.03% at December 31, 2023, and 61.39% at September 30, 2023.

    Borrowings
    As of September 30, 2024, total borrowings consisted of $500 million of FHLB advances. The FHLB advances include maturities of $300 million, at an average cost of approximately 4.73%, maturing in May of 2026, and $200 million, at a cost of 4.27% maturing in May of 2027. During the third quarter of 2024, we repaid the $1.3 billion of borrowings from the Federal Reserve’s Bank Term Funding Program, with a cost of 4.76%, that were scheduled to mature in January of 2025.

    Capital
    The Company’s total equity was $2.20 billion at September 30, 2024. This represented an overall increase of $119.9 million from total equity of $2.08 billion at December 31, 2023. Increases to equity included $149.9 million in net earnings and a $48.7 million increase in other comprehensive income, that were partially offset by $83.9 million in cash dividends. We engaged in no stock repurchases during the first nine months of 2024. Our tangible book value per share at September 30, 2024 was $10.17.

    Our capital ratios under the revised capital framework referred to as Basel III remain well-above regulatory standards. 

            CVB Financial Corp. Consolidated  
    Capital Ratios   Minimum Required Plus Capital Conservation Buffer   September 30, 2024   December 31, 2023   September 30, 2023  
                       
    Tier 1 leverage capital ratio   4.0 %   10.6 %   10.3 %   10.0 %  
    Common equity Tier 1 capital ratio   7.0 %   15.8 %   14.6 %   14.4 %  
    Tier 1 risk-based capital ratio   8.5 %   15.8 %   14.6 %   14.4 %  
    Total risk-based capital ratio   10.5 %   16.6 %   15.5 %   15.3 %  
                       
    Tangible common equity ratio       9.7 %   8.5 %   7.7 %  
                       

    CitizensTrust

    As of September 30, 2024, CitizensTrust had approximately $4.7 billion in assets under management and administration, including $3.3 billion in assets under management. Revenues were $3.6 million for the third quarter of 2024, compared to $3.2 million for the same period of 2023. CitizensTrust provides trust, investment and brokerage related services, as well as financial, estate and business succession planning.

    Corporate Overview
    CVB Financial Corp. (“CVBF”) is the holding company for Citizens Business Bank. CVBF is one of the 10 largest bank holding companies headquartered in California with more than $15 billion in total assets. Citizens Business Bank is consistently recognized as one of the top performing banks in the nation and offers a wide array of banking, lending and investing services with more than 60 banking centers and three trust office locations serving California.

    Shares of CVB Financial Corp. common stock are listed on the NASDAQ under the ticker symbol “CVBF”. For investor information on CVB Financial Corp., visit our Citizens Business Bank website at www.cbbank.com and click on the “Investors” tab.

    Conference Call
    Management will hold a conference call at 7:30 a.m. PDT/10:30 a.m. EDT on Thursday, October 24, 2024 to discuss the Company’s third quarter 2024 financial results. The conference call can be accessed live by registering at: https://register.vevent.com/register/BI6b56a1a5e9bf45efa402c04252b87308

    The conference call will also be simultaneously webcast over the Internet; please visit our Citizens Business Bank website at www.cbbank.com and click on the “Investors” tab to access the call from the site. Please access the website 15 minutes prior to the call to download any necessary audio software. This webcast will be recorded and available for replay on the Company’s website approximately two hours after the conclusion of the conference call and will be available on the website for approximately 12 months.

    Safe Harbor
    Certain statements set forth herein constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “will likely result”, “aims”, “anticipates”, “believes”, “could”, “estimates”, “expects”, “hopes”, “intends”, “may”, “plans”, “projects”, “seeks”, “should”, “will,” “strategy”, “possibility”, and variations of these words and similar expressions help to identify these forward-looking statements, which involve risks and uncertainties that could cause actual results or performance to differ materially from those projected. These forward-looking statements are based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company including, without limitation, plans, strategies, goals and statements about the Company’s outlook regarding revenue and asset growth, financial performance and profitability, capital and liquidity levels, loan and deposit levels, growth and retention, yields and returns, loan diversification and credit management, stockholder value creation, tax rates, the impact of economic developments, and the impact of acquisitions we have made or may make. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Company, and there can be no assurance that future developments affecting the Company will be the same as those anticipated by management. The Company cautions readers that a number of important factors, in addition to those set forth below, could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements.

    General risks and uncertainties include, but are not limited to, the following: the strength of the United States economy in general and the strength of the local economies in which we conduct business; the effects of, and changes in, trade, monetary, and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation/deflation, interest rate, market and monetary fluctuations; the effect of acquisitions we have made or may make, including, without limitation, the failure to obtain the necessary regulatory approvals, the failure to achieve the expected revenue growth and/or expense savings from such acquisitions, and/or the failure to effectively integrate an acquisition target, key personnel and customers into our operations; the timely development of competitive products and services and the acceptance of these products and services by new and existing customers; the impact of changes in financial services policies, laws, and regulations, including those concerning banking, taxes, securities, and insurance, and the application thereof by regulatory agencies; the effectiveness of our risk management framework and quantitative models; changes in the level of our nonperforming assets and charge-offs; the effect of changes in accounting policies and practices or accounting standards, as may be adopted from time-to-time by bank regulatory agencies, the U.S. Securities and Exchange Commission (“SEC”), the Public Company Accounting Oversight Board, the Financial Accounting Standards Board or other accounting standards setters; possible credit related impairments or declines in the fair value of loans and securities held by us; possible impairment charges to goodwill on our balance sheet; changes in customer spending, borrowing, and savings habits; the effects of our lack of a diversified loan portfolio, including the risks of geographic and industry concentrations; periodic fluctuations in commercial or residential real estate prices or values; our ability to attract or retain deposits (including low cost deposits) or to access government or private lending facilities and other sources of liquidity; the possibility that we may reduce or discontinue the payment of dividends on our common stock; changes in the financial performance and/or condition of our borrowers; changes in the competitive environment among financial and bank holding companies and other financial service providers; technological changes in banking and financial services; systemic or non-systemic bank failures or crises; geopolitical conditions, including acts or threats of terrorism, actions taken by the United States or other governments in response to acts or threats of terrorism, and/or military conflicts, which could impact business and economic conditions in the United States and abroad; catastrophic events or natural disasters, including earthquakes, drought, climate change or extreme weather events that may affect our assets, communications or computer services, customers, employees or third party vendors; public health crises and pandemics, and their effects on our asset credit quality, business operations, and employees, as well as the impact on general economic and financial market conditions; cybersecurity threats and fraud and the costs of defending against them, including the costs of compliance with legislation or regulations to combat fraud and cybersecurity threats; our ability to recruit and retain key executives, board members and other employees, and our ability to comply with federal and state employment laws and regulations; ongoing or unanticipated regulatory or legal proceedings or outcomes; and our ability to manage the risks involved in the foregoing. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the Company’s 2023 Annual Report on Form 10-K filed with the SEC and available at the SEC’s Internet site (http://www.sec.gov).

    The Company does not undertake, and specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements, except as required by law. Any statements about future operating results, such as those concerning accretion and dilution to the Company’s earnings or shareholders, are for illustrative purposes only, are not forecasts, and actual results may differ.

    Non-GAAP Financial Measures — Certain financial information provided in this earnings release has not been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and is presented on a non-GAAP basis. Investors and analysts should refer to the reconciliations included in this earnings release and should consider the Company’s non-GAAP measures in addition to, not as a substitute for or as superior to, measures prepared in accordance with GAAP. These measures may or may not be comparable to similarly titled measures used by other companies.

    CVB FINANCIAL CORP. AND SUBSIDIARIES
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (Unaudited)
    (Dollars in thousands)
                 
                 
        September 30,
    2024
      December 31,
    2023
      September 30,
    2023
     
    Cash and due from banks   $ 200,651     $ 171,396     $ 176,488  
    Interest-earning balances due from Federal Reserve     252,809       109,889       64,207  
    Total cash and cash equivalents     453,460       281,285       240,695  
    Interest-earning balances due from depository institutions     24,338       8,216       4,108  
    Investment securities available-for-sale     2,465,585       2,956,125       2,873,163  
    Investment securities held-to-maturity     2,405,254       2,464,610       2,489,441  
    Total investment securities     4,870,839       5,420,735       5,362,604  
    Investment in stock of Federal Home Loan Bank (FHLB)     18,012       18,012       18,012  
    Loans and lease finance receivables     8,572,565       8,904,910       8,877,632  
    Allowance for credit losses     (82,942 )     (86,842 )     (88,995 )
    Net loans and lease finance receivables     8,489,623       8,818,068       8,788,637  
    Premises and equipment, net     36,275       44,709       44,561  
    Bank owned life insurance (BOLI)     316,553       308,706       259,468  
    Intangibles     11,130       15,291       16,736  
    Goodwill     765,822       765,822       765,822  
    Other assets     417,164       340,149       402,372  
    Total assets   $ 15,403,216     $ 16,020,993     $ 15,903,015  
    Liabilities and Stockholders’ Equity            
    Liabilities:            
    Deposits:            
    Noninterest-bearing   $ 7,136,824     $ 7,206,175     $ 7,586,649  
    Investment checking     504,028       552,408       560,223  
    Savings and money market     3,745,707       3,278,664       3,906,187  
    Time deposits     685,930       396,395       305,727  
    Total deposits     12,072,489       11,433,642       12,358,786  
    Customer repurchase agreements     394,515       271,642       269,552  
    Other borrowings     500,000       2,070,000       1,120,000  
    Other liabilities     238,381       167,737       203,276  
    Total liabilities     13,205,385       13,943,021       13,951,614  
    Stockholders’ Equity            
    Stockholders’ equity     2,472,660       2,401,541       2,378,539  
    Accumulated other comprehensive loss, net of tax     (274,829 )     (323,569 )     (427,138 )
    Total stockholders’ equity     2,197,831       2,077,972       1,951,401  
    Total liabilities and stockholders’ equity   $ 15,403,216     $ 16,020,993     $ 15,903,015  
                 
    CVB FINANCIAL CORP. AND SUBSIDIARIES
    CONDENSED CONSOLIDATED AVERAGE BALANCE SHEETS
    (Unaudited)
    (Dollars in thousands)
                         
                         
          Three Months Ended
       Nine Months Ended
        September 30,
    2024
      June 30,
    2024
      September 30,
    2023
      September 30,
    2024
      September 30,
    2023
    Assets                    
    Cash and due from banks   $ 162,383     $ 162,724     $ 176,133     $ 162,385     $ 176,559  
    Interest-earning balances due from Federal Reserve     1,216,671       704,023       467,873       786,282       285,573  
    Total cash and cash equivalents     1,379,054       866,747       644,006       948,667       462,132  
    Interest-earning balances due from depository institutions     15,880       12,893       5,518       13,161       7,630  
    Investment securities available-for-sale     2,661,990       2,764,096       3,040,965       2,774,981       3,139,369  
    Investment securities held-to-maturity     2,418,043       2,442,863       2,501,625       2,439,427       2,524,799  
    Total investment securities     5,080,033       5,206,959       5,542,590       5,214,408       5,664,168  
    Investment in stock of FHLB     18,012       18,012       21,560       18,012       27,460  
    Loans and lease finance receivables     8,605,270       8,731,587       8,862,462       8,720,058       8,905,697  
    Allowance for credit losses     (82,810 )     (82,815 )     (86,986 )     (83,788 )     (86,222 )
    Net loans and lease finance receivables     8,522,460       8,648,772       8,775,476       8,636,270       8,819,475  
    Premises and equipment, net     38,906       43,624       45,315       42,291       45,731  
    Bank owned life insurance (BOLI)     315,435       312,645       258,485       312,574       257,358  
    Intangibles     11,819       13,258       17,526       13,216       19,256  
    Goodwill     765,822       765,822       765,822       765,822       765,822  
    Other assets     365,740       390,834       357,280       368,951       343,782  
    Total assets   $ 16,513,161     $ 16,279,566     $ 16,433,578     $ 16,333,372     $ 16,412,814  
    Liabilities and Stockholders’ Equity                    
    Liabilities:                    
    Deposits:                    
    Noninterest-bearing   $ 7,124,952     $ 7,153,315     $ 7,813,120     $ 7,153,557     $ 7,908,749  
    Interest-bearing     4,931,220       4,728,864       4,769,897       4,705,566       4,624,848  
    Total deposits     12,056,172       11,882,179       12,583,017       11,859,123       12,533,597  
    Customer repurchase agreements     363,959       287,128       340,809       320,280       461,478  
    Other borrowings     1,729,405       1,850,330       1,318,098       1,856,771       1,273,521  
    Other liabilities     196,832       157,463       164,624       174,328       133,046  
    Total liabilities     14,346,368       14,177,100       14,406,548       14,210,502       14,401,642  
    Stockholders’ Equity                    
    Stockholders’ equity     2,479,766       2,456,945       2,383,922       2,456,348       2,357,028  
    Accumulated other comprehensive loss, net of tax     (312,973 )     (354,479 )     (356,892 )     (333,478 )     (345,856 )
    Total stockholders’ equity     2,166,793       2,102,466       2,027,030       2,122,870       2,011,172  
    Total liabilities and stockholders’ equity   $ 16,513,161     $ 16,279,566     $ 16,433,578     $ 16,333,372     $ 16,412,814  
                         
    CVB FINANCIAL CORP. AND SUBSIDIARIES
    CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
    (Unaudited)
    (Dollars in thousands, except per share amounts)
                         
                         
          Three Months Ended
           Nine Months Ended
        September 30,
    2024
      June 30,
    2024
      September 30,
    2023
      September 30,
    2024
      September 30,
    2023
    Interest income:                    
    Loans and leases, including fees   $ 114,929     $ 114,200     $ 113,190     $ 345,478     $ 332,574
    Investment securities:                    
    Investment securities available-for-sale     20,178       21,225       22,441       62,849       61,393
    Investment securities held-to-maturity     13,284       13,445       13,576       40,131       41,272
    Total investment income     33,462       34,670       36,017       102,980       102,665
    Dividends from FHLB stock     375       377       598       1,171       1,430
    Interest-earning deposits with other institutions     16,986       9,825       6,422       32,884       11,583
    Total interest income     165,752       159,072       156,227       482,513       448,252
    Interest expense:                    
    Deposits     29,821       25,979       16,517       77,166       32,647
    Borrowings and customer repurchase agreements     22,312       22,244       16,339       68,418       46,971
    Total interest expense     52,133       48,223       32,856       145,584       79,618
    Net interest income before provision for (recapture of) credit losses     113,619       110,849       123,371       336,929       368,634
    Provision for (recapture of) credit losses                 2,000             4,000
    Net interest income after provision for (recapture of) credit losses     113,619       110,849       121,371       336,929       364,634
    Noninterest income:                    
    Service charges on deposit accounts     5,120       5,117       5,062       15,273       15,244
    Trust and investment services     3,565       3,428       3,246       10,217       9,475
    Loss on sale of AFS investment securities     (11,582 )                 (11,582 )    
    Gain on sale leaseback transactions     9,106                   9,106      
    Other     6,625       5,879       6,001       18,357       15,448
    Total noninterest income     12,834       14,424       14,309       41,371       40,167
    Noninterest expense:                    
    Salaries and employee benefits     36,647       35,426       34,744       108,474       103,539
    Occupancy and equipment     6,204       5,772       5,618       17,541       16,585
    Professional services     2,855       2,726       2,117       7,836       6,375
    Computer software expense     3,906       3,949       3,648       11,380       10,372
    Marketing and promotion     1,964       1,956       1,628       5,550       4,664
    Amortization of intangible assets     1,286       1,437       1,567       4,161       5,006
    (Recapture of) provision for unfunded loan commitments     (750 )     (500 )     (900 )     (1,250 )    
    Other     6,723       5,731       6,636       21,411       17,415
    Total noninterest expense     58,835       56,497       55,058       175,103       163,956
    Earnings before income taxes     67,618       68,776       80,622       203,197       240,845
    Income taxes     16,394       18,741       22,735       53,339       67,918
    Net earnings   $ 51,224     $ 50,035     $ 57,887     $ 149,858     $ 172,927
                         
    Basic earnings per common share   $ 0.37     $ 0.36     $ 0.42     $ 1.07     $ 1.24
    Diluted earnings per common share   $ 0.37     $ 0.36     $ 0.42     $ 1.07     $ 1.24
    Cash dividends declared per common share   $ 0.20     $ 0.20     $ 0.20     $ 0.60     $ 0.60
                         
    CVB FINANCIAL CORP. AND SUBSIDIARIES
    SELECTED FINANCIAL HIGHLIGHTS
    (Unaudited)
    (Dollars in thousands, except per share amounts)
                         
        Three Months Ended   Nine Months Ended
        September 30,
    2024
      June 30,
    2024
      September 30,
    2023
      September 30,
    2024
      September 30,
    2023
    Interest income – tax equivalent (TE)   $ 166,285     $ 159,607     $ 156,771     $ 484,120     $ 449,888  
    Interest expense     52,133       48,223       32,856       145,584       79,618  
    Net interest income – (TE)   $ 114,152     $ 111,384     $ 123,915     $ 338,536     $ 370,270  
                         
    Return on average assets, annualized     1.23 %     1.24 %     1.40 %     1.23 %     1.41 %
    Return on average equity, annualized     9.40 %     9.57 %     11.33 %     9.43 %     11.50 %
    Efficiency ratio [1]     46.53 %     45.10 %     39.99 %     46.29 %     40.11 %
    Noninterest expense to average assets, annualized     1.42 %     1.40 %     1.33 %     1.43 %     1.34 %
    Yield on average loans     5.31 %     5.26 %     5.07 %     5.29 %     4.99 %
    Yield on average earning assets (TE)     4.43 %     4.37 %     4.18 %     4.38 %     4.04 %
    Cost of deposits     0.98 %     0.88 %     0.52 %     0.87 %     0.35 %
    Cost of deposits and customer repurchase agreements     1.01 %     0.87 %     0.51 %     0.87 %     0.34 %
    Cost of funds     1.47 %     1.38 %     0.92 %     1.39 %     0.75 %
    Net interest margin (TE)     3.05 %     3.05 %     3.31 %     3.06 %     3.32 %
    [1] Noninterest expense divided by net interest income before provision for credit losses plus noninterest income.        
                         
    Tangible Common Equity Ratio (TCE) [2]                    
      CVB Financial Corp. Consolidated     9.71 %     8.68 %     7.73 %        
      Citizens Business Bank     9.59 %     8.57 %     7.63 %        
    [2] (Capital – [GW+Intangibles])/(Total Assets – [GW+Intangibles])        
                         
    Weighted average shares outstanding                    
    Basic     138,649,763       138,583,510       138,345,000       138,415,424       138,360,531  
    Diluted     138,839,499       138,669,058       138,480,633       138,548,651       138,481,462  
    Dividends declared   $ 27,977     $ 28,018     $ 27,901     $ 83,881     $ 83,695  
    Dividend payout ratio [3]     54.62 %     56.00 %     48.20 %     55.97 %     48.40 %
    [3] Dividends declared on common stock divided by net earnings.        
                         
    Number of shares outstanding – (end of period)     139,678,314       139,677,162       139,337,699          
    Book value per share   $ 15.73     $ 15.12     $ 14.00          
    Tangible book value per share   $ 10.17     $ 9.55     $ 8.39          
                         
        September 30,
    2024
      December 31,
    2023
      September 30,
    2023
           
                   
    Nonperforming assets:                    
    Nonaccrual loans   $ 21,913     $ 21,302     $ 9,963          
    Other real estate owned (OREO), net     647                      
    Total nonperforming assets   $ 22,560     $ 21,302     $ 9,963          
    Modified loans/performing troubled debt restructured loans (TDR) [4]   $ 15,769     $ 9,460     $ 7,304          
                         
    [4] Effective January 1, 2023, performing and nonperforming TDRs are reflected as Loan Modifications to borrowers experiencing financial difficulty.        
                         
    Percentage of nonperforming assets to total loans outstanding and OREO     0.26 %     0.24 %     0.11 %        
    Percentage of nonperforming assets to total assets     0.15 %     0.13 %     0.06 %        
    Allowance for credit losses to nonperforming assets     367.65 %     407.67 %     893.26 %        
                         
        Three Months Ended    Nine Months Ended
        September 30,
    2024
      June 30,
    2024
      September 30,
    2023
      September 30,
    2024
      September 30,
    2023
    Allowance for credit losses:                    
     Beginning balance   $ 82,786     $ 82,817     $ 86,967     $ 86,842     $ 85,117  
    Total charge-offs     (26 )     (51 )     (26 )     (4,344 )     (224 )
    Total recoveries on loans previously charged-off     182       20       54       444       102  
    Net recoveries (charge-offs)     156       (31 )     28       (3,900 )     (122 )
    Provision for (recapture of) credit losses                 2,000             4,000  
    Allowance for credit losses at end of period   $ 82,942     $ 82,786     $ 88,995     $ 82,942     $ 88,995  
                         
    Net recoveries (charge-offs) to average loans     0.002 %     -0.000 %     0.000 %     -0.045 %     -0.001 %
                         
    CVB FINANCIAL CORP. AND SUBSIDIARIES  
    SELECTED FINANCIAL HIGHLIGHTS  
    (Unaudited)  
    (Dollars in millions)  
                                             
    Allowance for Credit Losses by Loan Type                                    
                                             
        September 30, 2024   December 31, 2023   September 30, 2023    
        Allowance
    For Credit
    Losses
      Allowance
    as a % of
    Total Loans
    by Respective
    Loan Type
      Allowance
    For Credit
    Losses
      Allowance
    as a % of
    Total Loans
    by Respective
    Loan Type
      Allowance
    For Credit
    Losses
      Allowance
    as a % of
    Total Loans
    by Respective
    Loan Type
       
                                             
    Commercial real estate   $ 69.7     1.05 %     $ 69.5     1.02 %     $ 70.9     1.04 %      
    Construction     0.5     3.07 %       1.3     1.91 %       1.0     1.59 %      
    SBA     2.5     0.92 %       2.7     0.99 %       3.0     1.08 %      
    Commercial and industrial     5.3     0.56 %       9.1     0.94 %       9.3     0.99 %      
    Dairy & livestock and agribusiness     3.8     1.12 %       3.1     0.75 %       3.6     1.01 %      
    Municipal lease finance receivables     0.2     0.28 %       0.2     0.29 %       0.3     0.33 %      
    SFR mortgage     0.4     0.16 %       0.5     0.20 %       0.5     0.20 %      
    Consumer and other loans     0.5     0.99 %       0.4     0.85 %       0.4     0.82 %      
                                             
    Total   $ 82.9     0.97 %     $ 86.8     0.98 %     $ 89.0     1.00 %      
                                             
    CVB FINANCIAL CORP. AND SUBSIDIARIES  
    SELECTED FINANCIAL HIGHLIGHTS  
    (Unaudited)  
    (Dollars in thousands, except per share amounts)  
                               
    Quarterly Common Stock Price  
                               
          2024       2023       2022    
    Quarter End   High   Low   High   Low   High   Low  
    March 31,   $ 20.45   $ 15.95     $ 25.98     $ 16.34     $ 24.37     $ 21.36    
    June 30,   $ 17.91   $ 15.71     $ 16.89     $ 10.66     $ 25.59     $ 22.37    
    September 30,   $ 20.29   $ 16.08     $ 19.66     $ 12.89     $ 28.14     $ 22.63    
    December 31,   $   $     $ 21.77     $ 14.62     $ 29.25     $ 25.26    
                               
    Quarterly Consolidated Statements of Earnings  
                               
            Q3   Q2   Q1   Q4   Q3  
              2024       2024       2024       2023       2023    
    Interest income                          
    Loans and leases, including fees       $ 114,929     $ 114,200     $ 116,349     $ 115,721     $ 113,190    
    Investment securities and other         50,823       44,872       41,340       42,357       43,037    
    Total interest income         165,752       159,072       157,689       158,078       156,227    
    Interest expense                          
    Deposits         29,821       25,979       21,366       18,888       16,517    
    Borrowings and customer repurchase agreements     22,312       22,244       23,862       19,834       16,339    
    Total interest expense         52,133       48,223       45,228       38,722       32,856    
    Net interest income before (recapture of)                      
    provision for credit losses         113,619       110,849       112,461       119,356       123,371    
    (Recapture of) provision for credit losses                       (2,000 )     2,000    
    Net interest income after (recapture of)                      
    provision for credit losses         113,619       110,849       112,461       121,356       121,371    
                               
    Noninterest income         12,834       14,424       14,113       19,163       14,309    
    Noninterest expense         58,835       56,497       59,771       65,930       55,058    
    Earnings before income taxes         67,618       68,776       66,803       74,589       80,622    
    Income taxes         16,394       18,741       18,204       26,081       22,735    
    Net earnings       $ 51,224     $ 50,035     $ 48,599     $ 48,508     $ 57,887    
                               
    Effective tax rate         24.25 %     27.25 %     27.25 %     34.97 %     28.20 %  
                               
    Basic earnings per common share       $ 0.37     $ 0.36     $ 0.35     $ 0.35     $ 0.42    
    Diluted earnings per common share     $ 0.37     $ 0.36     $ 0.35     $ 0.35     $ 0.42    
                               
    Cash dividends declared per common share   $ 0.20     $ 0.20     $ 0.20     $ 0.20     $ 0.20    
                               
    Cash dividends declared       $ 27,977     $ 28,018     $ 27,886     $ 27,945     $ 27,901    
                               
    CVB FINANCIAL CORP. AND SUBSIDIARIES
    SELECTED FINANCIAL HIGHLIGHTS
    (Unaudited)
    (Dollars in thousands)
                         
    Loan Portfolio by Type
        September 30, June 30,   March 31,   December 31,   September 30,
          2024       2024       2024       2023       2023  
                         
    Commercial and industrial   $ 6,618,637     $ 6,664,925     $ 6,720,538     $ 6,784,505     $ 6,843,059  
    Construction     14,755       52,227       58,806       66,734       63,022  
    SBA     272,001       267,938       268,320       270,619       283,124  
    SBA – PPP     1,255       1,757       2,249       2,736       3,233  
    Commercial and industrial     936,489       956,184       963,120       969,895       938,064  
    Dairy & livestock and agribusiness     342,445       350,562       351,624       412,891       351,463  
    Municipal lease finance receivables     67,585       70,889       72,032       73,590       75,621  
    SFR mortgage     267,181       267,593       276,475       269,868       268,171  
    Consumer and other loans     52,217       49,771       57,549       54,072       51,875  
    Gross loans, at amortized cost     8,572,565       8,681,846       8,770,713       8,904,910       8,877,632  
    Allowance for credit losses     (82,942 )     (82,786 )     (82,817 )     (86,842 )     (88,995 )
    Net loans   $ 8,489,623     $ 8,599,060     $ 8,687,896     $ 8,818,068     $ 8,788,637  
                         
                         
                         
    Deposit Composition by Type and Customer Repurchase Agreements
                         
        September 30, June 30,   March 31,   December 31,   September 30,
          2024       2024       2024       2023       2023  
                         
    Noninterest-bearing   $ 7,136,824     $ 7,090,095     $ 7,112,789     $ 7,206,175     $ 7,586,649  
    Investment checking     504,028       515,930       545,066       552,408       560,223  
    Savings and money market     3,745,707       3,409,320       3,561,512       3,278,664       3,906,187  
    Time deposits     685,930       774,980       675,554       396,395       305,727  
    Total deposits     12,072,489       11,790,325       11,894,921       11,433,642       12,358,786  
                         
    Customer repurchase agreements     394,515       268,826       275,720       271,642       269,552  
    Total deposits and customer repurchase agreements   $ 12,467,004     $ 12,059,151     $ 12,170,641     $ 11,705,284     $ 12,628,338  
                         
    CVB FINANCIAL CORP. AND SUBSIDIARIES  
    SELECTED FINANCIAL HIGHLIGHTS  
    (Unaudited)  
    (Dollars in thousands)  
                           
    Nonperforming Assets and Delinquency Trends  
        September 30, June 30,   March 31,   December 31,   September 30,
     
          2024       2024       2024       2023       2023    
    Nonperforming loans:                      
    Commercial real estate   $ 18,794     $ 21,908     $ 10,661     $ 15,440     $ 3,655    
    Construction                                
    SBA     151       337       54       969       1,050    
    Commercial and industrial     2,825       2,712       2,727       4,509       4,672    
    Dairy & livestock and agribusiness     143             60       60       243    
    SFR mortgage                 308       324       339    
    Consumer and other loans                             4    
    Total   $ 21,913     $ 24,957     $ 13,810     $ 21,302     $ 9,963   [1]
    % of Total loans     0.26 %     0.29 %     0.16 %     0.24 %     0.11 %  
                           
    Past due 30-89 days (accruing):                      
    Commercial real estate   $ 30,701     $ 43     $ 19,781     $ 300     $ 136    
    Construction                                
    SBA                 408       108          
    Commercial and industrial     64       103       6       12          
    Dairy & livestock and agribusiness                                
    SFR mortgage                       201          
    Consumer and other loans                       18          
    Total   $ 30,765     $ 146     $ 20,195     $ 639     $ 136    
    % of Total loans     0.36 %     0.00 %     0.23 %     0.01 %     0.00 %  
                           
    OREO:                      
    Commercial real estate   $     $     $     $     $    
    SBA                                
    Commercial and industrial     647       647       647                
    SFR mortgage                                
    Total   $ 647     $ 647     $ 647     $     $    
    Total nonperforming, past due, and OREO   $ 53,325     $ 25,750     $ 34,652     $ 21,941     $ 10,099    
    % of Total loans     0.62 %     0.30 %     0.40 %     0.25 %     0.11 %  
                           
      [1] Includes $2.6 million of nonaccrual loans past due 30-89 days.                
                           
       
    CVB FINANCIAL CORP. AND SUBSIDIARIES  
    SELECTED FINANCIAL HIGHLIGHTS  
    (Unaudited)  
                       
    Regulatory Capital Ratios  
                       
                       
                       
            CVB Financial Corp. Consolidated  
    Capital Ratios   Minimum Required Plus
    Capital Conservation Buffer
      September 30,
    2024
      December 31,
    2023
      September 30,
    2023
     
                       
    Tier 1 leverage capital ratio   4.0 %   10.6 %   10.3 %   10.0 %  
    Common equity Tier 1 capital ratio   7.0 %   15.8 %   14.6 %   14.4 %  
    Tier 1 risk-based capital ratio   8.5 %   15.8 %   14.6 %   14.4 %  
    Total risk-based capital ratio   10.5 %   16.6 %   15.5 %   15.3 %  
                       
    Tangible common equity ratio       9.7 %   8.5 %   7.7 %  
                       
    Tangible Book Value Reconciliations (Non-GAAP)
     
    The tangible book value per share is a Non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. The following is a reconciliation of tangible book value to the Company stockholders’ equity computed in accordance with GAAP, as well as a calculation of tangible book value per share as of September 30, 2024, December 31, 2023 and September 30, 2023.   
     
                   
          September 30,
    2024
      December 31,
    2023
      September 30,
    2023
     
          (Dollars in thousands, except per share amounts)  
                 
    Stockholders’ equity   $ 2,197,831     $ 2,077,972     $ 1,951,401  
    Less: Goodwill     (765,822 )     (765,822 )     (765,822 )
    Less: Intangible assets     (11,130 )     (15,291 )     (16,736 )
    Tangible book value   $ 1,420,879     $ 1,296,859     $ 1,168,843  
    Common shares issued and outstanding     139,678,314       139,344,981       139,337,699  
    Tangible book value per share   $ 10.17     $ 9.31     $ 8.39  
                 
    Return on Average Tangible Common Equity Reconciliations (Non-GAAP)
                             
    The return on average tangible common equity is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. The following is a reconciliation of net income, adjusted for tax-effected amortization of intangibles, to net income computed in accordance with GAAP; a reconciliation of average tangible common equity to the Company’s average stockholders’ equity computed in accordance with GAAP; as well as a calculation of return on average tangible common equity.
     
          Three Months Ended     Nine Months Ended
          September 30, June 30,   September 30, September 30, September 30,
            2024       2024       2023       2024       2023    
          (Dollars in thousands)  
                             
      Net Income   $ 51,224     $ 50,035     $ 57,887     $ 149,858     $ 172,927    
      Add: Amortization of intangible assets     1,286       1,437       1,567       4,161       5,006    
      Less: Tax effect of amortization of intangible assets [1]     (380 )     (425 )     (463 )     (1,230 )     (1,480 )  
      Tangible net income   $ 52,130     $ 51,047     $ 58,991     $ 152,789     $ 176,453    
                             
      Average stockholders’ equity   $ 2,166,793     $ 2,102,466     $ 2,027,030     $ 2,122,870     $ 2,011,172    
      Less: Average goodwill     (765,822 )     (765,822 )     (765,822 )     (765,822 )     (765,822 )  
      Less: Average intangible assets     (11,819 )     (13,258 )     (17,526 )     (13,216 )     (19,256 )  
      Average tangible common equity   $ 1,389,152     $ 1,323,386     $ 1,243,682     $ 1,343,832     $ 1,226,094    
                             
      Return on average equity, annualized [2]     9.40 %     9.57 %     11.33 %     9.43 %     11.50 %  
      Return on average tangible common equity, annualized [2]     14.93 %     15.51 %     18.82 %     15.19 %     19.24 %  
                             
                             
      [1] Tax effected at respective statutory rates.                      
      [2] Annualized where applicable.                      
                             

    Contact:        
    David A. Brager        
    President and Chief Executive Officer
    (909) 980-4030

    The MIL Network

  • MIL-OSI Security: Long Island Child Therapist Charged with Distribution of Child Pornography

    Source: Office of United States Attorneys

    Earlier today, Renee Hoberman, a licensed social worker, was arrested on charges of distribution of child pornography.  The defendant was arraigned this afternoon at the federal courthouse in Central Islip before United States Magistrate Judge Arlene R. Lindsay on a complaint and ordered detained.

    Breon Peace, United States Attorney for the Eastern District of New York, and William S. Walker, Special Agent in Charge, Homeland Security Investigations, New York (HSI) and Patrick Ryder, Commissioner, Nassau County Police Department announced the charges.

    “As alleged, Hoberman distributed heinous and disturbing child pornography, including videos showing infants being restrained and raped.  Additionally, while posing as a man, Hoberman, who is a therapist serving children, claimed to have produced child pornography and offered others the opportunity to sexually abuse children,” stated United States Attorney Peace.  “Our investigation into Hoberman is ongoing, and we urge anyone with information to contact HSI’s tip line.  Together with our law enforcement partners, we will relentlessly pursue predators who victimize children and prosecute them to the fullest extent of the law.”

    “This case is an example of the vital work our investigators do every day in cooperation with our dedicated partners in federal law enforcement,” said Nassau County Police Commissioner Patrick Ryder. “The hard working and diligent detectives of the Nassau County Police Department will continue to work tirelessly to protect the innocent, and we will never stop fighting to bring those who victimize children to justice.”

    As set forth in the complaint, between June 2024 and October 2024, Hoberman allegedly used social media messaging apps to upload digital videos depicting one or more minors engaging in sexually explicit conduct, including several videos of infants six months to one year of age being physically restrained and raped by an adult male, as the infants cried and frantically screamed for the duration of the videos.  As recently as on or about October 16, 2024, the defendant uploaded child pornography and engaged in multiple chats concerning child sexual molestation.  In these chats, the defendant, purporting to be a man, claimed to have multiple minor children and stated that “he” would have anal sex with the children and would punish them by getting naked, stripping the children naked, and spanking them while the other children watched.  The defendant invited another user to visit “his” family in New York to spank the children.  In addition, the defendant described sexually abusing “his” children and their friends, and then sent two videos containing child sexual abuse material, claiming that these videos depicted the user’s own children.

    According to public records and as alleged in the complaint, Hoberman works as a therapist with an organization based in Melville, New York and serves children aged 0-17.

    Anyone with information about sexual exploitation by the defendant is asked to contact HSI at HSI’s tip line: (866) 347-2423 or via HSI’s website: https://www.ice.gov/webform/ice-tip-form.

    The charges in the complaint are allegations, and the defendant is presumed innocent unless and until proven guilty.  If convicted, Hoberman faces a mandatory minimum sentence of five years in prison.                       

    This prosecution is part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse.  Led by United States Attorneys’ Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.

    The government’s case is being handled by the Criminal Section of the Office’s Long Island Division.  Assistant United States Attorneys James R. Simmons and Russell Noble are in charge of the prosecution.

    The Defendant:

    Renee Hoberman, also known as “Rina Hoberman”
    Age:  36
    Plainview, New York

    E.D.N.Y. Docket No. 24-MJ-588

    MIL Security OSI

  • MIL-OSI Security: Former Teacher Sentenced to 20 Years in Prison for Producing Child Pornography with Hidden Cameras

    Source: Office of United States Attorneys

    ST. LOUIS – U.S. District Judge Henry E. Autrey on Wednesday sentenced a former St. Louis County, Missouri teacher to 20 years in prison for producing child pornography with hidden cameras.

    Judge Autrey also ordered Joseph R. Gutowski to pay $86,500 in restitution to his victims, including those who appeared in the child sexual abuse material he collected.

    Gutowski hid cameras in his office at Lafayette High School in Wildwood and in his home. He secretly filmed a minor and traded some of the images with others online. He was a member of an underground child pornography group on the cloud storage service Mega. He also traded videos he’d secretly recorded of an adult in the “Club Creep” group on Mega.

    Gutowski, 42, pleaded guilty in U.S. District Court in St. Louis in July to one count of producing of child pornography and one count of receiving child pornography.

    The FBI and the St. Louis County Police Department Special Investigations Unit investigated the case.  Assistant U.S. Attorney Jillian Anderson prosecuted the case.

    This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Department of Justice Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

    MIL Security OSI

  • MIL-OSI USA: Remarks by APNSA Jake Sullivan at the Brookings  Institution

    US Senate News:

    Source: The White House
    Brookings InstitutionWashington, D.C.
    Good morning, everyone.  And thank you so much, David, for that introduction and for having me here today.  It’s great to be back at Brookings.
    As many of you know, I was here last year to lay out President Biden’s vision for renewing American economic leadership, a vision that responded to several converging challenges our country faced: the return of intense geopolitical competition; a rise in inequality and a squeeze on the middle class; a less vibrant American industrial base; an accelerating climate crisis; vulnerable supply chains; and rapid technological change.
    For the preceding three decades, the U.S. economy had enjoyed stronger topline aggregate growth than other advanced democracies, and had generated genuine innovation and technological progress, but our economic policies had not been adapted to deal effectively with these challenges.  That’s why President Biden implemented a modern industrial strategy, one premised on investing at home in ourselves and our national strength, and on shifting the energies of U.S. foreign policy to help our partners around the world do the same.
    In practice, that’s meant mobilizing public investment to unlock private sector investment to deliver on big challenges like the clean energy transition and artificial intelligence, revitalizing our capacity to innovate and to build, creating diversified and resilient global supply chains, setting high standards for everything from labor to the environment to technology.  Because on that level playing field, our logic goes, America can compete and win.  Preserving open markets and also protecting our national security and doing all of these things together with allies and partners.
    Since I laid this vision out in my speech at Brookings last year, I’ve listened with great interest to many thoughtful responses, because these are early days.  Meaningful shifts in policy require constant iteration and reflection.  That’s what will make our policy stronger and more sustainable. 
    So, today, I’m glad to be back here at Brookings to reengage in this conversation, because I really believe that the ideas I’m here to discuss and the policies that flow from them are among the most consequential elements of the administration’s foreign as well as domestic policy, and I believe they will constitute an important legacy of Joe Biden’s presidency. 
    I want to start by reflecting on some of the questions I’ve heard and then propose a few ways to consolidate our progress.
    One overarching question is at the core of many others: Does our new approach mean that we’re walking away from a positive-sum view of the world, that America is just in it for itself at the expense of everyone else? 
    In a word, no, it doesn’t.  In fact, we’re returning to a tradition that made American international leadership such a durable force, what Alexis de Tocqueville called “interest rightly understood.”  The notion that it’s in our own self-interest to strengthen our partners and sustain a fair economic system that helps all of us prosper.
    After World War Two, we built an international economic order in the context of a divided world, an order that helped free nations recover and avoid a return to the protectionist and nationalist mistakes of the 1930s, an order that also advanced American economic and geopolitical power.
    In the 1990s, after the collapse of the Soviet Union, we took that order global, embracing the old Eastern bloc, China, India, and many developing countries.  Suddenly, the major powers were no longer adversaries or competitors.  Capital flowed freely across borders.  Global supply chains became “just in time,” without anyone contemplating potential strategic risk.
    Each of these approaches was positive-sum, and each reflected the world as it was.
    Now, the world of the 1990s is over, and it’s not coming back, and it’s not a coherent plan or critique just to wish it so.
    We’re seeing the return of great power competition.  But unlike the Cold War era, our economies are closely intertwined.  We’re on the verge of revolutionary technological change with AI, with economic and geopolitical implications.  The pandemic laid bare the fragilities in global supply chains that have been growing for decades.  The climate crisis grows more urgent with every hurricane and heat wave. 
    So we need to articulate, once again, de Tocqueville’s notion of interest rightly understood.  To us, that means pursuing a strategy that is fundamentally positive-sum, calibrated to the geopolitical realities of today and rooted in what is good for America — for American workers, American communities, American businesses, and American national security and economic strength.
    We continue to believe deeply in the mutual benefits of international trade and investment, enhanced and enabled by bold public investment in key sectors; bounded in rare but essential cases by principled controls on key national security technologies; protected against harmful non-market practices, labor and environment abuses, and economic coercion; and critically coordinated with a broad range of partners. 
    The challenges we face are not uniquely our own and nor can we solve them alone.  We want and need our partners to join us.  And given the demand signal we hear back from them, we think that in the next decade, American leadership will be measured by our ability to help our partners pull off similar approaches and build alignment and complementarity across our policies and our investments. 
    If we get that right, we can show that international economic integration is compatible with democracy and national sovereignty.  And that is how we get out of Dani Rodrik’s trilemma.
    Now, what does that mean in practice?  What does this kind of positive-sum approach mean for trade policy?  Are we walking away from trade as a core pillar of international economic policy? 
    U.S. exports and imports have recovered from their dip during the pandemic, with the real value of U.S. trade well above 2019 levels in each of the last two years.  We’re also the largest outbound source of FDI in the world. 
    So, we are not walking away from international trade and investment.  What we are doing is moving away from specific policies that, frankly, didn’t contemplate the urgent challenges we face: The climate crisis.  Vulnerable, concentrated, critical mineral and semiconductor supply chains.  Persistent attacks on workers’ rights.  And not just more global competition, but more competition with a country that uses pervasive non-market policies and practices to distort and dominate global markets. 
    Ignoring or downplaying these realities will not help us chart a viable path forward.  Our approach to trade responds to these challenges. 
    Climate is a good example.  American manufacturers are global leaders in clean steel production, yet they’ve had to compete against companies that produce steel more cheaply but with higher emissions intensity.  That’s why, earlier this year, the White House stood up a Climate and Trade Task Force, and the task force has been developing the right tools to promote decarbonization and ensure our workers and businesses engaged in cleaner production aren’t disadvantaged by firms overseas engaged in dirtier, exploitative production.
    Critical minerals are another example.  That sector is marked by extreme price volatility, widespread corruption, weak labor and environmental protections, and heavy concentration in the PRC, which artificially drops prices to keep competitors out of the marketplace. 
    If we and our partners fail to invest, the PRC’s domination of these and other supply chains will only grow, and that will leave us increasingly dependent on a country that has demonstrated its willingness to weaponize such dependencies.  We can’t accept that, and neither can our partners. 
    That’s why we are working with them to create a high-standard, critical minerals marketplace, one that diversifies our supply chains, creates a level playing field for our producers, and promotes strong workers’ rights and environmental protections.  And we’re driving towards tangible progress on that idea in just the next few weeks.
    In multiple sectors that are important to our future, not just critical minerals, but solar cells, lithium-ion batteries, electric vehicles, we see a broad pattern emerging.  The PRC is producing far more than domestic demand, dumping excess onto global markets at artificially low prices, driving manufacturers around the world out of business, and creating a chokehold on supply chains.
    To prevent a second China shock, we’ve had to act. 
    That’s what drove the decisions about our 301 tariffs earlier this year.
    Now, we know that indiscriminate, broad-based tariffs will harm workers, consumers, and businesses, both in the United States and our partners.  The evidence on that is clear.  That’s why we chose, instead, to target tariffs at unfair practices in strategic sectors where we and our allies are investing hundreds of billions of dollars to rebuild our manufacturing and our resilience. 
    And crucially, we’re seeing partners in both advanced and emerging economies reach similar conclusions regarding overcapacity and take similar steps to ward off damage to their own industries, from the EU to Canada to Brazil to Thailand to Mexico to Türkiye and beyond.  That’s a big deal.
    And it brings me back to my earlier point: We’re pursuing this new trade approach in concert with our partners.  They also recognize we need modern trade tools to achieve our objectives.  That means considering sector-specific trade agreements.  It means creating markets based on standards when that’s more effective.  And it also means revitalizing international institutions to address today’s challenges, including genuinely reforming the WTO to deal with the challenges I’ve outlined. 
    And it means thinking more comprehensively about our economic partnerships.  That’s why we created the Indo-Pacific Economic Framework and the Americas Partnership for Economic Prosperity.  That’s why we also gave them such catchy names. 
    Within IPEF, we finalized three agreements with 13 partners to accelerate the clean energy transition, to promote high labor standards, to fight corruption, and to shore up supply chain vulnerabilities before they become widespread disruptions.  And within APEP, we’re working to make the Western Hemisphere a globally competitive supply chain hub for semiconductors, clean energy, and more. 
    And that leads to the next question I’ve often been asked in the last year and a half: Where does domestic investment fit into all of this?  How does our positive-sum approach square with our modern industrial strategy?
    The truth is that smart, targeted government investment has always been a crucial part of the American formula.  It’s essential to catalyzing private investment and growth in sectors where market failures or other barriers would lead to under-investment.
    Somehow, we forgot that along the way, or at least we stopped talking about it.  But there was no plausible version of answers on decarbonization or supply chain resilience without recovering this tradition.  And so we have.
    We’ve made the largest investment ever to diversify and accelerate clean energy deployment through the Inflation Reduction Act.  And investments are generating hundreds of billions of dollars in private investment all across the country; rapid growth in emerging climate technologies like sustainable aviation fuels, carbon management, clean hydrogen, with investments increasing 6- to 15-fold from pre-IRA levels. 
    This will help us meet our climate commitments.  This will advance our national security.  And this will ensure that American workers and communities can seize the vast economic opportunities of the clean energy transition and that those opportunities are broadly shared.  And that last part is crucial. 
    The fact is that many communities hard hit in decades past still haven’t bounced back, and the two-thirds of American adults who don’t have college degrees have seen unacceptably poor outcomes in terms of real wages, health, and other outcomes over the last four decades.
    For many years, people assumed that these distributional issues would be solved after the fact by domestic policies.  That has not worked. 
    Advancing fairness, creating high-quality jobs, and revitalizing American communities can’t be an afterthought, which is why we’ve made them central to our approach. 
    In fact, as a result of the incentives in the IRA to build in traditional energy communities, investment in those communities has doubled under President Joe Biden.
    Now, initially, when we rolled this all out, our foreign partners worried that it was designed to undercut them, that we were attempting to shift all the clean energy investment and production around the world to the United States.
    But that wasn’t the case, and it isn’t the case. 
    We know that our partners need to invest.  In fact, we want them to invest.  The whole world benefits from the spillover effects of advances in clean energy that these investments bring. 
    And we are nowhere near the saturation point of investment required to meet our clean energy deployment goals, nor will markets alone generate the resources necessary either. 
    So, we’ve encouraged our partners to invest in their own industrial strength.  We’ve steered U.S. foreign policy towards being a more helpful partner in this endeavor.  And our partners have begun to join us.  Look at Japan’s green transformation policy, India’s production-linked incentives, Canada’s clean energy tax credit, the European Union’s Green Deal.
    As more and more countries adopt this approach, we will continue to build out the cooperative mechanisms that we know will be necessary to ensure that we’re acting together to scale up total global investment, not competing with each other over where a fixed set of investments is located.
    The same goes for investing in our high-tech manufacturing strength.  We believe that a nation that loses the capacity to build, risks losing the capacity to innovate.  So, we’re building again.
    As a result of the CHIPS and Science Act, America is on track to have five leading-edge logic and memory chip manufacturers operating at scale.  No other economy has more than two.  And we’re continuing to nurture American leadership in artificial intelligence, including through actions we’re finalizing, as I speak, to ensure that the physical infrastructure needed to train the next generation of AI models is built right here in the United States. 
    But all of this high-tech investment and development hasn’t come at the expense of our partners.  We’ve done it alongside them. 
    We’re leveraging CHIPS Act funding to make complementary investments in the full semiconductor supply chain, from Costa Rica to Vietnam. 
    We’re building a network of AI safety institutes around the world, from Canada to Singapore to Japan, to harness the power of AI responsibly. 
    And we’ve launched a new Quantum Development Group to deepen cooperation in a field that will be pivotal in the decades ahead.
    Simply put, we’re thinking about how to manage this in concert with our allies and partners, and that will make all of us more competitive.
    Now, all this leads to another question that is frequently asked:  What about your technology protection policies?  How does that fit into a positive-sum approach?
    The United States and our allies and partners have long limited the export of dual-use technologies.  This is logical and uncontroversial.  It doesn’t make sense to allow companies to sell advanced technology to countries that could use them to gain military advantage over the United States and our friends. 
    Now, it would be a mistake to attempt to return to the Cold War paradigm of almost no trade, including technological trade, among geopolitical rivals.  But as I’ve noted, we’re in a fundamentally different geopolitical context, so we’ve got to meet somewhere in the middle. 
    That means being targeted in what we restrict, controlling only the most sensitive technologies that will define national security and strategic competition.  This is part of what we mean when we say: de-risking, not decoupling.
    To strike the right balance, to ensure we’re not imposing controls in an arbitrary or reflexive manner, we have a framework that informs our decision-making.  We ask ourselves at least four questions:
    One, which sensitive technologies are or will likely become foundational to U.S. national security? 
    Two, across those sensitive technologies, where do we have distinct advantages and are likely to see maximal effort by our competitors to close the gap?  Conversely, where are we behind and, therefore, most vulnerable to coercion?
    Three, to what extent do our competitors have immediate substitutes for U.S.-sensitive technology, either through indigenous development or from third countries, that would undercut the controls?
    Four, what is the breadth and depth of the coalition we could plausibly build and sustain around a given control?
    When it comes to a narrow set of sensitive technologies, yes, the fence is high, as it should be. 
    And in the context of broader commerce, the yard is small, and we’re not looking to expand it needlessly.
    Now, beyond the realm of export controls and investment screening, we will also take action to protect sensitive data and our critical infrastructure, such as our recent action on connected vehicles from countries of concern.
    I suspect almost no one here would argue that we should build out our telecommunications architecture or our data center infrastructure with Huawei. 
    Millions of cars on the road with technology from the PRC, getting daily software updates from the PRC, sending reams of information back to the PRC, similarly doesn’t make sense, especially when we’ve already seen evidence of a PRC cyber threat to our critical infrastructure.
    We have to anticipate systemic cyber and data risks in ways that, frankly, we didn’t in the past, including what that means for the future Internet of Things, and we have to take the thoughtful, targeted steps necessary in response.
    This leads to a final, kind of fundamental question: Does this approach reflect some kind of pessimism about the United States and our inherent interests? 
    Quite the contrary.  It reflects an abiding and ambitious optimism.  We believe deeply that we can act smartly and boldly, that we can compete and win, that we can meet the great challenges of our time, and that we can deliver for all of our people here in the United States. 
    And while it’s still very early, we have some evidence of that.  This includes the strongest post-pandemic recovery of any advanced economy in the world.  There’s more work to do, but inflation has come down.  And contrary to the predictions that the PRC would overtake the U.S. in GDP either in this decade or the next, since President Biden took office, the United States has more than doubled our lead.  And last year, the United States attracted more than five times more inbound foreign direct investment than the next highest country. 
    We are once again demonstrating our capacity for resilience and reinvention, and others are noticing.  The EU’s Draghi report, published last month, mirrors key aspects of our strategy. 
    Now, as we continue to implement this vision, we will need to stay rigorous.  We will need, for example, to be bold enough to make the needed investments without veering into unproductive subsidies that crowd-out the private sector or unduly compete with our partners.
    We’re clear-eyed that our policies will involve choices and trade-offs.  That’s the nature of policy.  But to paraphrase Sartre, not to choose is also a choice, and the trade-offs only get worse the longer we leave our challenges unchecked.
    Pointing out that it’s challenging to strike the right balance is not an argument to be satisfied with the status quo.
    We have tried to start making real a new positive-sum vision, and we have tried to start proving out its value.  But we still have our work cut out for us. 
    So I’d actually like to end today with a few questions of my own, where our answers will determine our shared success: 
    First, will we sustain the political will here at home to make the investments in our own national strength that will be required of us in the years ahead? 
    Strategic investments like these need to be a bipartisan priority, and I have to believe that we’ll rise to the occasion, that we won’t needlessly give up America’s position of economic and technological leadership because we can no longer generate the political consensus to invest in ourselves.
    There is more we can do now on a bipartisan basis. 
    For example, Congress still hasn’t appropriated the science part of CHIPS and Science, even while the PRC is increasing its science and technology budget by 10 percent year on year.
    Now, whether we’re talking about investments in fundamental research, or grants and loans for firms developing critical technologies, we also have to update our approach to risk.  Some research paths are dead ends.  Some startups won’t survive.  Our innovation base and our private sector are the envy of the world because they take risks.  The art of managing risk for the sake of innovation is critical to successful geostrategic competition. 
    So, we need to nurture a national comfort with, to paraphrase FDR, bold and persistent experimentation.  And when an investment falls short, as it will, we need to maintain our bipartisan will, dust ourselves off, and keep moving forward.  To put it bluntly, our competitors hope we’re not capable of that.  We need to prove them wrong.  We need to make patient, strategic investments in our capacity to compete, and we need to ensure fiscal sustainability in order to keep making those investments over the long term.
    The second question: Will we allocate sufficient resources for investments that are needed globally? 
    Last year, here at Brookings, I talked about the need to go from billions to trillions in investment to help emerging and developing countries tackle modern challenges, including massively accelerating the speed and scale of the clean energy transition. 
    We need a Marshall Plan-style effort, investing in partners around the world and supporting homegrown U.S. innovation in growing markets like storage, nuclear, and geothermal energy. 
    Now, trillions may sound lofty and unachievable, but there is a very clear path to get there without requiring anywhere near that level of taxpayer dollars, and that path is renewed American leadership and investment in international institutions. 
    For example, at the G20 this fall, we’re spearheading an effort that calls for the international financial institutions, the major creditors in the private sector, to step up their relief for countries facing high debt service burdens so they too can invest in their future. 
    Or consider the World Bank and the IMF.  We’ve been leading the charge to make these institutions bigger and more effective, to fully utilize their balance sheets and be more responsive to the developing and emerging economies they serve.  That has already unlocked hundreds of billions of dollars in new lending capacity, at no cost to the United States.  And we can generate further investment on the scale required with very modest U.S. public investments and legislative fixes.  That depends on Congress taking action. 
    For example, our administration requested $750 million — million — from Congress to boost the World Bank’s lending capacity by over $36 billion, which, if matched by our partners, could generate over $100 billion in new resources.  This would allow the World Bank to deploy $200 for every $1 the taxpayers provide.
    We’ve asked Congress to approve investments in a new trust fund at the IMF to help developing countries build resilience and sustainability.  Through a U.S. investment in the tens of millions, we could enable tens of billions in new IMF lending.
    And outside the World Bank and the IMF, we’re asking Congress to increase funding for the Partnership for Global Infrastructure and Investment, which we launched at the G7 a couple of years ago. 
    This partnership catalyzes and concentrates investment in key corridors, including Africa and Asia, to close the infrastructure gap in developing countries.  It strengthens countries’ economic growth.  It strengthens America’s supply chains and global trusted technology vendors.  And it strengthens our partnerships in critical regions. 
    The private sector has been enthusiastic.  Together with them and our G7 partners, we’ve already mobilized tens of billions of dollars, and we can lever that up and scale that up in the years ahead with help on a bipartisan basis from the Congress.
    We need to focus on the big picture.  Holding back small sums of money has the effect of pulling back large sums from the developing world — which also, by the way, effectively cedes the field to other countries like the PRC.  There are low-cost, commonsense solutions on the table, steps that should not be the ceiling of our ambitions, but the floor.  And we need Congress to provide us the authorities and the seed funding to take those steps now.
    Finally, will we empower our agencies and develop new muscle to meet this moment? 
    Simply put, we need to ensure that we have the resources and the capabilities in the U.S. government to implement this economic vision over the long haul.  This starts by significantly strengthening our bilateral tools, answering a critique that China has a checkbook and the U.S. has a checklist. 
    Next year, the United States is going to face a critical test of whether our country is up to the task.  The DFC, the Ex-Im Bank, and AGOA, the African Growth and Opportunity Act, are all up for renewal by Congress.  This provides a once-in-a-decade chance for America to strengthen some of its most important tools of economic statecraft. 
    And think about how they can work better with the high-leverage multilateral institutions I just mentioned.  The DFC, for example, is one of our most effective instruments to mobilize private sector investments in developing countries.
    But the DFC is too small compared to the scope of investment needed, and it lacks tools our partners want, like the ability to deploy more equity as well as debt, and it’s often unable to capitalize on fast-moving investment opportunities.  So, we put forward a proposal to expand the DFC’s toolkit and make it bigger, faster, nimbler. 
    Another gap we need to bridge is to make sure we attract, retain, and empower top-tier talent with expertise in priority areas.
    We’re asking Congress to approve the resources we’ve requested for the Commerce’s Bureau of Industry Security, Treasury’s Office of Investment Security, the Department of Justice’s National Security Division. 
    If Congress is serious about America competing and winning, we need to be able to draw on America’s very best.
    Let me close with this:
    Since the end of World War Two, the United States has stood for a fair and open international economy; for the power of global connection to fuel innovation; for the power of trade and investment done right to create good jobs; for the power, as Tocqueville put it, of interest rightly understood.
    Our task ahead is to harness that power to take on the realities of today’s geopolitical moment in a way that will not only preserve America’s enduring strengths, but extend them for generations to come.  It will take more conversations like this one and iteration after iteration to forge a new consensus and perfect a new set of policies and capabilities to match the moment. 
    I hope it’s a project we can all work on together.  We can’t afford not to. 
    So, thank you.  And I look forward to continuing the conversation, including hearing some of your questions this morning. 

    MIL OSI USA News

  • MIL-OSI: WISeKey Launches its Enhanced INeS AI Security Broker Solution

    Source: GlobeNewswire (MIL-OSI)

    WISeKey Launches its Enhanced INeS AI Security Broker Solution

    Geneva, Switzerland – October 24, 2024 – WISeKey International Holding (“WISeKey”, SIX: WIHN, NASDAQ: WKEY), a global leader in cybersecurity digital identity and Internet of Things (IoT) innovations operating as a holding company, today announced the launch of the enhanced INeS AI Security Broker solution. This innovative upgrade integrates Artificial Intelligence (AI) with Public Key Infrastructure (PKI) technologies, revolutionizing how credentials are remotely and securely verified. The new solution manages the activation, deactivation, revocation, renewal, and secure update of IoT devices and business applications with end-to-end protection.

    As organizations increasingly incorporate AI-powered applications into their operations, the number of digital identities in circulation continues to rise, creating challenges not just in scale but also in security and management complexity. To address these evolving needs, WISeKey’s INeS AI Security Broker introduces a smarter, automated approach to managing digital certificates and identities across expanding IoT networks.

    Key Features of the INeS AI Security Broker:

    • Seamless Integration: Easily compatible with any IoT platform, the INeS AI Security Broker supports the secure issuance of digital certificates, lifecycle management, and rapid authentication for vast networks of devices.
    • AI-Powered Insights: The integration of machine learning enables automatic pattern recognition and anomaly detection from sensor data, such as temperature, pressure, humidity, and vibration, providing real-time insights and enhanced security.
    • Proactive Threat Management: AI-enhanced PKI solutions mitigate risks by automating security processes and preventing potential threats before they escalate. Predictive analytics allow organizations to pinpoint vulnerabilities and address misconfigurations swiftly.

    The surge in digital identities and devices places significant strain on traditional PKI systems, increasing operational burdens for system administrators. Any disruption or mismanagement in digital identity management could result in severe security risks and operational downtime. To counter these challenges, WISeKey’s AI-powered PKI solutions streamline processes, enabling organizations to efficiently manage their digital certificates while significantly reducing the risk of breaches and operational failures.

    Addressing Key Challenges in AI-PKI Integration:
    While the advantages of integrating AI with PKI systems are clear, adoption remains low due to the technical complexity of these domains. WISeKey seeks to bridge this gap through strategic partnerships, offering organizations access to tailored AI and PKI solutions that meet their specific security needs.

    As AI continues to transform the cybersecurity landscape, its role in managing and securing digital identities will become indispensable. The combination of PKI and AI will help organizations protect their digital assets, ensure compliance with evolving regulations, and maintain resilient digital infrastructures.

    Strategic Implications for the Future:
    The integration of AI into PKI not only enhances security but also builds trust by embracing cutting-edge approaches to digital identity management. WISeKey’s technology enables organizations to stay ahead of emerging threats, positioning them to manage the growing complexity of IoT networks while ensuring that their infrastructure is secure and compliant.

    WISeKey remains committed to advancing its technology platform and forming long-term relationships with strategic partners, enabling high-profile clients to leverage state-of-the-art solutions in cybersecurity, digital identity, AI, and IoT.

    For more information on the INeS AI Security Broker and WISeKey’s suite of cybersecurity solutions, visithttps://www.wisekey.com/device-identity-lifecycle-management/. .

    About WISeKey
    WISeKey is a Swiss-based computer infrastructure company specializing in cybersecurity, digital identity, blockchain, Internet of Things (IoT) solutions, and post-quantum semiconductors. As a computer infrastructure company, WISeKey provides secure platforms for data and device management across industries like finance, healthcare, and government. It leverages its Public Key Infrastructure (PKI) to ensure encrypted communications and authentication, while also focusing on next-generation security through post-quantum cryptography.

    WISeKey’s work with post-quantum semiconductors is aimed at future-proofing its security solutions against the threats posed by quantum computing. These advanced semiconductors support encryption that can withstand the computational power of quantum computers, ensuring the long-term security of connected devices and critical infrastructure. Combined with its expertise in blockchain and IoT, WISeKey’s post-quantum technologies provide a robust foundation for secure digital ecosystems at the hardware, software, and network levels.

    Disclaimer
    This communication expressly or implicitly contains certain forward-looking statements concerning WISeKey International Holding Ltd and its business. Such statements involve certain known and unknown risks, uncertainties and other factors, which could cause the actual results, financial condition, performance or achievements of WISeKey International Holding Ltd to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. WISeKey International Holding Ltd is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.

    This press release does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, and it does not constitute an offering prospectus within the meaning of the Swiss Financial Services Act (“FinSA”), the FinSa’s predecessor legislation or advertising within the meaning of the FinSA. Investors must rely on their own evaluation of WISeKey and its securities, including the merits and risks involved. Nothing contained herein is, or shall be relied on as, a promise or representation as to the future performance of WISeKey.

    Press and Investor Contacts

    WISeKey International Holding Ltd
    Company Contact: Carlos Moreira
    Chairman & CEO
    Tel: +41 22 594 3000
    info@wisekey.com 
    WISeKey Investor Relations (US) 
    The Equity Group Inc.
    Lena Cati
    Tel: +1 212 836-9611 / lcati@equityny.com
    Katie Murphy
    Tel: +1 212 836-9612 / kmurphy@equityny.com

    The MIL Network

  • MIL-OSI Economics: Global Principles for Effective Border Adjustments

    Source: International Chamber of Commerce

    Headline: Global Principles for Effective Border Adjustments

    We use necessary cookies to make our site work. We’d also like to set optional cookies to optimize site functionality and to give you the most relevant experience. We won’t set optional cookies unless you enable them. Using this tool will set a cookie on your device to remember your preferences.

    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.

    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.

    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.

    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.

    MIL OSI Economics

  • MIL-OSI Economics: Advancing biodiversity with AI

    Source: Microsoft

    Headline: Advancing biodiversity with AI

    The health of our society is deeply intertwined with the health of our planet. While much of the global conversation around the environment focuses on the devastating impacts of climate change, it is crucial to recognize that climate and biodiversity are part of a broader ecological system. The loss and degradation of nature is both a result of and a contributor to climate disruption, as healthy ecosystems play a vital role in regulating the climate. Since 1970, global wildlife populations have plummeted by 70%. And in the last century, nearly 500 vertebrate species have been lost forever. 

    This week, leaders from around the world are gathering for COP16, a United Nations conference in Cali, Colombia, to drive actions to reverse this trend. COP16 will focus on advancing global efforts to implement the UN Biodiversity Plan, which highlights the critical role that companies must play in building a nature-positive world. 

    Microsoft is committed to helping the world drive progress on the UN Biodiversity Plan. Using our technology, investment, and voice, we work to advance the protection and restoration of nature.  Microsoft will be participating in COP16 to share our work and learnings, participate in high-level meetings and panel discussions, and perhaps most importantly, listen, to explore what more we can do to tackle this critical challenge together. 

    Leveraging AI to Boost Biodiversity  

    At Microsoft, we believe we must use technology that matches the scale and complexity of the challenges we face. Given the vastness and complexity of Earth’s ecosystems, AI is emerging as an indispensable conservation tool. AI can empower us with the speed and scale necessary to analyze and better understand Earth’s biodiversity. 

    Technology can not only coexist with nature but help it thrive. One such example is Project Guacamaya, which combines the power of AI with satellite imagery, wildlife imagery, and acoustic data to monitor deforestation and protect biodiversity in the Amazon. Nearly five million acres of the Amazon were deforested in 2022, a 21% increase from the previous year. Thanks to Project Guacamaya, a joint effort of the CinfonIA Research Center at Universidad de los Andes, Instituto SINCHI, Instituto Humboldt, Planet Labs PBC and Microsoft AI for Good Lab, AI is helping protect this tremendous natural resource.   

    YouTube Video

    One aspect of Project Guacamaya involves using AI to identify bird and non-bird sounds in the Amazon. The project has so far analyzed more than 100,000 sounds and achieved over 80% reliability in species identification. Because AI offers real-time analysis, this tool allows researchers and conservationists to respond quickly and effectively to ecological shifts. As Zhongqi Miao, AI for Good Lab’s lead bioacoustics research scientist, noted, “By converting sounds from nature into measurable data, AI helps monitor wildlife populations and track changes in ecosystems.”  

    Building AI and Conservation Skills 

    It’s imperative that the global workforce be prepared to address the biodiversity crisis. This means training more green talent. A LinkedIn study found that the share of green talent in 48 evaluated countries increased by a median of 12.3% between 2022 and 2023. This is promising progress, but we must increase the momentum: the same study found that only one in eight workers around the world has at least one green skill, such as those related to solar power or electric vehicles.  

    We also need to ensure that our green workforce can leverage technology to advance sustainability. Applying advanced AI models in real-world conservation scenarios can be challenging due to their complexity and the need for specialized knowledge. That’s why researchers involved with Project Guacamaya released Pytorch Wildlife, an open-source platform available on GitHub designed for creating, modifying, and sharing powerful AI conservation models.  

    Pytorch Wildlife’s intuitive, user-friendly interface, accessible through local installation or Hugging Face, enables users to detect and classify animals in images and videos. With an emphasis on usability and accessibility, Pytorch Wildlife can be used by individuals with limited or no technical background. It also offers a modular codebase to simplify feature expansion and further development. 

    Strengthening Corporate Investments in Nature 

    In 2020, Microsoft launched a new ecosystems and biodiversity initiative in which we pledged to protect more land than we use while leveraging our voice, tools, and investments to protect and restore ecosystems. We know that our efforts alone won’t be enough to drive the pace and scale of progress needed. When it comes to advancing biodiversity and sustainability, governments, the science community, NGOs, and the private sector all have a vital role to play.   

    Other Microsoft efforts to boost biodiversity in Latin America include projects to restore and protect freshwater ecosystems in São Paulo; drive wetland restoration through on-the-ground efforts, public policy advocacy, collective action, and scientific research in Chile; restore traditional wetland agriculture methods to conserve Lake Xochimilco and the Axolotl; and protect 236,000 acres in the biodiversity hotspot of Belize’s Maya Forest.  

    Our nature-based carbon removal investments, including those with Mombak and BTG Pactual, are also aligned with our commitment to become carbon negative by 2030. Our agreement with BTG Pactual, which is the largest known carbon dioxide removal credit transaction to date, is part of BTG Pactual’s $1 billion reforestation and restoration strategy in Latin America. Parties interested in learning more should join us for a panel discussion with BTG Pactual at the Bloom 24 event in Cali, Colombia, on October 25. 

    Through our $1 billion Climate Innovation Fund, we support innovative solutions that can provide scaled positive impact for people and the planet across our four sustainability pillars: carbon, water, waste, and ecosystem. The companies in our portfolio are pairing cutting-edge technologies and datasets with the latest in Internet of Things (IoT), machine learning, and cloud computing, to create data-driven solutions that enable better decision-making and action for natural ecosystems. Our recent investments include: 

    • Yard Stick – a soil carbon monitoring, reporting, and verification (MRV) company that has created an innovative soil carbon IoT device, paired with data analytics and insights to measure and track soil carbon at farm scale.
    • Vibrant Planet – a prioritization system for land management restoration efforts.
    • Farmland LP – an investment management firm that buys conventional farmland and transitions it to organic farmland, utilizing regenerative agriculture practices.    

    Lessons for the Future 

    Over the last four years, we have made progress in contributing to a nature-positive world. However, our journey has not been without challenges. There is more to do and more to learn. It can be difficult for companies to invest holistically in ecosystem health because they often lack the knowledge, tools, and incentives needed to do so. Recently, we collaborated with an international team of experts to explore what is needed to overcome these challenges. In this whitepaper, we outline eight important lessons:  

    1. Build incentives to invest in ecosystem health: Establish mechanisms that recognize and reward companies for investing in nature-based solutions that improve ecosystem health and ensure local community benefits and stewardship. 
    2. Agree on science-based standards for ecosystem health: Civil society and companies need to collaborate with scientists to agree on corporate standards for characterizing how sustainability investments affect ecosystem health. 
    3. Make science accessible and build capacity to use it: All actors need to use the best available science to evaluate ecological and social risks, design projects that enhance ecosystem health, and assess it effectively.   
    4. Accept tradeoffs and work to minimize them: While not all sustainability benefits can be maximized at once, strategic planning can reduce negative impacts and optimize positive outcomes.  
    5. Innovate to derisk investment: Nature-based investments face risks from the variability of natural systems; better tools are needed to understand, insure, and manage these risks. 
    6. Expand blended finance: Combining public and private capital can reduce financial risks to private investors and attract more investment into nature-based solutions. 
    7. Invest beyond capital: While funding is vital, projects and startups also need strategic support, including expertise, long-term demand signals, and market access. 
    8. Leverage AI for scale, speed, and reliability: AI can help companies prioritize ecosystem health by enabling cheaper, more effective measurement, trade-off analysis, and risk management.  

    The challenges facing our ecosystems are substantial, but so too are the resources at our disposal. Our COP16 convening in Cali ahead of COP30 in Brazil next year will help bring much-needed global focus to this critical topic in a vibrant part of our planet – known for its unparalleled biodiversity and its important role in regulating climate patterns and safeguarding ecosystems globally. We are looking forward to continuing to explore ways we can collectively take action and leverage technology to protect and preserve ecosystems for generations to come.   

    Tags: AI, AI for Earth, AI for Good, AI for Good Labs, biodiversity, Climate Innovation Fund, Environment, Environmental Sustainability, sustainability

    MIL OSI Economics

  • MIL-OSI: Bitget Wallet Integrates ApeChain for Enhanced DApp and Meme Coin Trading

    Source: GlobeNewswire (MIL-OSI)

    VICTORIA, Seychelles, Oct. 23, 2024 (GLOBE NEWSWIRE) — Bitget Wallet is thrilled to announce its integration with the ApeChain mainnet, the native blockchain of the Bored Ape Yacht Club. This collaboration opens exciting opportunities for users to engage with the ApeChain ecosystem, enhancing DApp interactions and meme coin trading experiences.

    With the Bitget Wallet browser extension and mobile app, users can effortlessly switch to the ApeChain network without complex manual setups. This simplifies coin additions, enables seamless transfers, and provides straightforward access to decentralized exchanges (DEXs) for trading. Looking ahead, Bitget Wallet plans to introduce popular meme coin swap functionality and real-time market data for ApeChain, further enriching the trading experience.

    Integrating ApeChain lowers the barrier to entry for users eager to explore this vibrant ecosystem and discover trending meme coins. With the ability to quickly tap into market hotspots and seize breakout opportunities, Bitget Wallet becomes an essential tool for savvy traders. Additionally, a dedicated section for ApeChain DApps has been added to the Bitget Wallet’s “Discover” tab, allowing users to connect easily with various decentralized applications and access innovative projects within the ecosystem.

    In just 12 hours since its launch, ApeChain has recorded over 360,000 transactions, generating 495.17 APE in transaction fees, demonstrating its significant market potential. As the ApeChain ecosystem evolves, Bitget Wallet remains committed to enhancing its platform with more functionalities and services related to ApeChain, ensuring users receive the best possible trading experience.

    With BAYC’s launch of ApeChain, we’re witnessing a pivotal shift in the crypto landscape,” said Alvin Kan, COO of Bitget Wallet. “As the NFT market faces declining interest, meme coins are emerging as the new frontier of crypto trading, much like NFTs did in their prime. This surge in meme coin popularity is attracting new investors and reshaping market sentiment. Bitget Wallet is dedicated to supporting the ApeChain ecosystem by providing seamless access to its DApps and facilitating meme coin trading, ensuring our users remain at the forefront of this dynamic environment.”

    About Bitget Wallet

    Bitget Wallet stands as one of the world’s leading non-custodial Web3 wallets and decentralized ecosystem platform. With the Bitget Onchain Layer, the wallet is well-poised to develop a burgeoning DeFi ecosystem through co-creation and strategic incubation. Aside from a powerful Swap function, Bitget Wallet also offers multi-chain asset management, smart money insights, a native Launchpad, Inscriptions Center, and an Earning Center. Supporting over 100 major blockchains, 500,000+ tokens, and a wide array of DApps, Bitget Wallet is your top wallet for asset discovery and Web3 exploration.

    For more information, visit: Website | Twitter | Telegram | Discord

    A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/2a5b7a4d-7b1b-4398-92c6-2a323c11ff16

    The MIL Network

  • MIL-OSI: MiddleGround Capital secures 83.54 percent of all shares in Takeover Offer for STEMMER IMAGING AG

    Source: GlobeNewswire (MIL-OSI)

    THIS ANNOUNCEMENT IS NOT AN OFFER, WHETHER DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA, HONG KONG, JAPAN, NEW ZEALAND, RUSSIA, SINGAPORE, OR SOUTH AFRICA OR IN ANY OTHER JURISDICTION WHERE SUCH OFFER PURSUANT TO LEGISLATION AND REGULATIONS IN SUCH RELEVANT JURISDICTION WOULD BE PROHIBITED BY APPLICABLE LAW.

    LEXINGTON, Ky., Oct. 23, 2024 (GLOBE NEWSWIRE) — Ventrifossa BidCo AG (the “Bidder”), a holding company controlled by MiddleGround Capital (“MiddleGround“) has secured 10.00 percent of all shares of STEMMER IMAGING AG (“STEMMER”; ISIN DE000A2G9MZ9 / GSIN A2G9MZ) in its voluntary public takeover offer for STEMMER (“Takeover Offer”). The additional acceptance period ended on October 18, 2024. In addition, the Bidder has signed a purchase agreement for approximately 69.36 percent of the shares with the majority shareholder of STEMMER, PRIMEPULSE SE. Together, with the shares it already holds, the Bidder has now secured a total of 83.54 percent of STEMMER shares.

    All required merger control and foreign direct investment clearances have been obtained and the Takeover Offer is not subject to any further conditions. The settlement of the Takeover Offer is currently expected to occur on November 5, 2024.

    About MiddleGround
    MiddleGround Capital is a private equity firm based in Lexington, Kentucky with over $3.7 billion of assets under management. MiddleGround makes majority investments in middle market B2B industrial and specialty distribution businesses. MiddleGround works with its portfolio companies to create value through a hands-on operational approach and partners with its management teams to support long-term growth strategies. For more information, please visit: https://middleground.com.

    About STEMMER IMAGING AG
    STEMMER IMAGING AG is the leading international systems house for machine vision technology. With a background of all-round engineering expertise, STEMMER IMAGING AG delivers the entire spectrum of machine vision services for both, industrial and non-industrial applications – from value-added services to the development of subsystems and its own products, based on an extensive commercial range of products. For more information, please visit: https://www.stemmer-imaging.com/.

    Media Contacts:

    International media inquiries
    Stephan Göttel
    Kekst CNC
    Stephan.Goettel@kekstcnc.com   
    +49 162 269 4588

    US media inquiries
    Doug Allen/Maya Hanowitz
    Dukas Linden Public Relations
    MiddleGround@dlpr.com
    +1 (646) 722-6530

    Important Note

    This announcement is neither an offer to purchase nor a solicitation of an offer to sell shares in STEMMER, whether directly or indirectly in or into the United States of America, Australia, Canada, Hong Kong, Japan, New Zealand, Russia, Singapore or South Africa, in jurisdictions where such offer pursuant to legislation and regulations in such relevant jurisdictions would be prohibited by applicable law.

    The Takeover Offer itself as well as its terms and conditions and further provisions concerning the Takeover Offer is set out in in detail in the offer document as approved by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht). Investors and holders of shares in STEMMER are strongly advised to thoroughly read the offer document and all other relevant documents regarding the Takeover Offer since they will contain important information. Shareholders not resident in Germany wanting to accept the Offer must make inquiries on relevant and applicable legislation, including but not limited to whether governmental consent is required and possible tax consequences. The Takeover Offer is not made, directly or indirectly, and sale will not be accepted from, or on behalf of, shareholders in any jurisdiction where presenting the Takeover Offer or acceptance thereof would be in conflict with the laws of such jurisdictions.

    The Takeover Offer is exclusively subject to the laws of the Federal Republic of Germany. Any agreement that is entered into as a result of accepting the Takeover Offer will be exclusively governed by the laws of the Federal Republic of Germany and is to be interpreted in accordance with such laws.

    The Takeover Offer and the information and documents contained in the offer document are not being made and have not been approved by an “authorized person” for the purposes of section 21 of the UK Financial Services and Markets Act 2000 (the “FSMA“). Accordingly, the information and documents contained in the offer document are not being distributed to, and must not be passed on to, the general public in the United Kingdom unless an exemption applies. The communication of the information and documents contained in the offer document is exempt from the restriction on financial promotions under section 21 of the FSMA on the basis that it is a communication by or on behalf of a body corporate which relates to a transaction to acquire day to day control of the affairs of a body corporate; or to acquire 50 per cent or more of the voting shares in a body corporate, within article 62 of the FSMA (Financial Promotion) Order 2005.

    The Takeover Offer described herein is made on the basis of the exemptions to publish a prospectus in Switzerland set out in article 36 para. 1 lit. b of the Swiss Financial Services Act (“FinSA“). None of the offering documentation or information relating to the Takeover Offer constitutes a prospectus pursuant to the FinSA. No such documentation or information has been nor will be filed with or approved by any Swiss regulatory authority.

    The MIL Network

  • MIL-OSI Security: U.S. Attorney Announces Murder-for-Hire Charges Against IRGC Brigadier General and Former Intelligence Officer and Members of an Iranian Intelligence Network

    Source: Federal Bureau of Investigation (FBI) State Crime Alerts (c)

    Ruhollah Bazghandi and Members of His Iran-Based Network, Contracted Members of an Eastern European Organized Crime Group to Murder a U.S. Citizen of Iranian Origin in New York City Who Has Publicly Opposed the Iranian Government

    Damian Williams, the United States Attorney for the Southern District of New York; Merrick B. Garland, the Attorney General of the United States; Matthew G. Olsen, the Assistant Attorney General for National Security; Christopher A. Wray, the Director of the Federal Bureau of Investigation (“FBI”); and James E. Dennehy, Assistant Director in Charge of the New York Field Office of the FBI, announced the unsealing of murder-for-hire, money-laundering, and sanctions charges against RUHOLLAH BAZGHANDI, a/k/a “Roohollah Azimi,” FNU LNU, a/k/a “Haj Taher,” (“HAJ TAHER”), HOSSEIN SEDIGHI, and SEYED MOHAMMAD FOROUZAN.  The charges are contained in a Superseding Indictment unsealed today in Manhattan federal court.  As detailed in the Superseding Indictment, BAZGHANDI, HAJ TAHER, SEDIGHI, and FOROUZAN contracted members of an Eastern European criminal organization, including RAFAT AMIROV, a/k/a “Farkhaddin Mirzoev,” a/k/a “Pᴎᴍ,”  a/k/a “Rome,” POLAD OMAROV, a/k/a “Araz Aliyev,” a/k/a “Polad Qaqa,” a/k/a “Haci Qaqa,” and ZIALAT MAMEDOV, a/k/a “Ziko,” to murder a U.S. citizen of Iranian origin in New York City who has publicly opposed the Iranian Government and who has previously been the target of similar plots by the Iranian Government.  AMIROV, OMAROV, and MAMEDOV previously were arrested on charges contained in underlying indictments.  AMIROV and OMAROV are in custody in the U.S., pending trial; Mamedov was extradited from the Czech Republic to the Republic of Georgia (“Georgia”) to face charges there.  BAZGHANDI, HAJ TAHER, SEDIGHI, and FOROUZAN, all of whom are based in Iran, remain at large.  The case is pending before U.S. District Judge Colleen McMahon.

    U.S. Attorney Damian Williams said: “As alleged, for years, the Government of Iran has attempted to assassinate, on U.S. soil, a U.S. citizen of Iranian origin who is a prominent critic of the Iranian regime.  In January 2023, we unsealed charges alleging that members of an Eastern European crime group engaged in a plot to murder this victim.  As we allege, that group was not acting alone.  Today, we hold their Iranian masters to account, and allege that these Iran-based co-conspirators, including a Brigadier General in the Islamic Revolutionary Guard Corps, directed the murder plot.  By charging these Iran-based defendants, we seek to strike another public blow at the heart of the Government of Iran’s efforts to execute the victim—as well as its lethal targeting, intimidation, and repression of other Iranian dissidents critical of the regime in the U.S. and abroad.”  

    Attorney General Merrick B. Garland said: “The Justice Department has now charged eight individuals, including an Iranian military official, for their efforts to silence and kill a U.S. citizen because of her criticism of the Iranian regime.  We will not tolerate efforts by an authoritarian regime like Iran to undermine the fundamental rights guaranteed to every American.  Three of the defendants charged in this horrific plot are now in U.S. custody, and we will never stop working to identify, find, and bring to justice all those who endanger the safety of the American people.”

    Assistant Attorney General Matthew G. Olsen said: “Today’s indictment makes plain that the Iranian regime for years has been behind a violent campaign to stalk, intimidate, and arrange the killing of an American dissident on U.S. soil for bravely speaking up for the rights of the Iranian people.  The Department is committed to exposing and holding accountable those in Tehran who believe they can hide their hand in carrying out such reprehensible activities.”

    FBI Director Christopher A. Wray said: “Today’s indictment exposes the full extent of Iran’s plot to silence an American journalist for criticizing the Iranian regime.  According to the charges, a brigadier general in the Islamic Revolutionary Guard Corps and a former Iranian intelligence officer, working with a network of conspirators, planned to kill a dissident living in New York City.  The FBI’s investigation led to the disruption of this plot as one of the conspirators was allegedly on their way to murder the victim in New York.  As these charges show, the FBI will work with our partners here and abroad to hold accountable those who target Americans.”

    FBI Assistant Director in Charge James E. Dennehy said: “Today we charge four members of the Bazghandi Network – each connected to the Iranian government – as being responsible for hiring members of an Eastern European Organized Crime Group to murder an American citizen in New York City.   This crime was intended to stop an American from exercising their Constitutionally protected right to free speech; to end their life for speaking out publicly against the Iranian regime and its human rights violations.  The FBI will aggressively pursue, disrupt, and hold accountable any foreign government which attempts to murder our citizens on our soil.”

    According to the allegations contained in the Superseding Indictment, other court filings, and statements made during court proceedings:[1] 

    BAZGHANDI, who resides in Iran, is an Islamic Revolutionary Guard Corps (“IRGC”) Brigadier General and has previously served as chief of an IRGC Intelligence Organization (“IRGC-IO”) counterintelligence office.  In April 2023, the U.S. Secretary of State designated IRGC-IO as a Specially Designated Global Terrorist under Executive Order 14078, relating to hostage-taking and the wrongful detention of U.S. nationals abroad. On the same date, the U.S. Treasury Department sanctioned BAZGHANDI in connection with his involvement with the detention of foreign prisoners held in Iran.  BAZGHANDI was designated by the Treasury Department a second time in June 2023, this time under Executive Order 13224, for his participation in IRGC-IO’s lethal targeting operations.  HAJ TAHER, SEDIGHI, and FOROUZAN (collectively with BAZGHANDI, the “Bazghandi Network”), each of whom resides in Iran, also have connections to the Government of Iran.    

    The Bazghandi Network contracted AMIROV, OMAROV, MAMEDOV, and Khalid Mehdiyev to murder, on U.S. soil, a victim (the “Victim”) residing in New York City.  The Victim is a journalist, author, and human rights activist who has publicized the Government of Iran’s human rights abuses and suppression of political expression, including in connection with continuing protests against the regime across Iran.  As recently as 2020 and 2021, Iranian intelligence officials and assets plotted to kidnap the Victim from within the U.S. for rendition to Iran in an effort to silence the Victim’s criticism of the regime.  That plot was disrupted and exposed by the FBI and led to the filing of federal kidnapping conspiracy and other charges in the Southern District of New York against several participants in the plot in U.S. v. Farahani, et al., 21 Cr. 430 (RA) (S.D.N.Y.).

    Since at least July 2022, the Bazghandi Network tasked members of the Organization with assassinating the Victim.  The Organization’s participation in the murder-for-hire plot was directed by AMIROV, who resided in Iran and who was tasked with targeting the Victim by individuals in Iran.  On approximately July 13, 2022, AMIROV forwarded targeting information—which Amirov had received from individuals in Iran—about the Victim and the Victim’s residence to OMAROV.  OMAROV, in turn, together with MAMEDOV, directed and collaborated with Mehdiyev, who was residing in Yonkers, New York, to carry out the plot against the Victim. Mehdiyev’s participation in the plot was disrupted when he was arrested near the Victim’s home on or about July 28, 2022, while in possession of the assault rifle, along with 66 rounds of ammunition, approximately $1,100 in cash, and a black ski mask.

    In January 2023, AMIROV, OMAROV, and MAMEDOV were arrested overseas.  On January 27, 2023, they were charged publicly for their roles in the plot to assassinate the Victim.  Nevertheless, in the months that followed, members of the Bazghandi Network continued to target the Victim.  For example, in or about March 2023, HAJ TAHER searched for information about the Victim’s family members and SEDIGHI saved an image of the Victim’s residence. As recently as on or about May 1, 2023, BAZGHANDI conducted an Internet search, in Farsi, for, “a person in the house of [the Victim] movie,” and, on the same date, watched a video with the title, “A video of the arrested gunman in front of [the Victim]’s home in New York received by [the Victim’s employer].”

    *               *                *

    BAZGHANDI, HAJ TAHER, SEDIGHI, and FOROUZAN, all of Iran, have been charged with murder-for-hire, which carries a maximum sentence of 10 years in prison (Count One); conspiracy to commit murder-for-hire, which carries a maximum sentence of 10 years in prison (Count Two); conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison (Count Three); and conspiring to violate the International Emergency Economic Powers Act and sanctions against the Government of Iran, which carries a maximum sentence of 20 years in prison (Count Six).

    AMIROV, 45, of IRAN; OMAROV, 39, of the Czech Republic and Slovenia; Mamedov, 32, of Georgia; also have been charged in Counts One, Two, and Three, as well as with attempted murder in aid of racketeering, which carries a maximum sentence of 10 years in prison (Count Four); and possession and use of a firearm in connection with the attempted murder, which carries a maximum sentence of life imprisonment and a mandatory minimum sentence of 5 years in prison (Count Five).

    The potential maximum sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants will be determined by Judge McMahon.

    Mr. Williams praised the outstanding investigative work of the FBI and its New York Field Office Counterintelligence-Cyber Division and the New York FBI Iran Threat Task Force.  Mr. Williams also thanked the New York City Police Department (“NYPD”) and the NYPD Intelligence Bureau, as well as the Department of Justice’s National Security Division and the Department of Justice’s Office of International Affairs, for their assistance.

    This case is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys Michael D. Lockard, Jacob H. Gutwillig, and Matthew J.C. Hellman are in charge of the prosecution, with assistance from Trial Attorneys Christopher Rigali and Leslie Esbrook of the Counterintelligence and Export Control Section, and Dmitriy Slavin of the National Security Division’s Counterterrorism Section.

    The charges in the Superseding Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.


    [1] As the introductory phrase signifies, the Superseding Indictment, and the description of the Superseding Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

    MIL Security OSI

  • MIL-OSI: WISeKey Enters Into $30 Million Convertible Notes Subscription Agreements

    Source: GlobeNewswire (MIL-OSI)

    WISeKey Enters Into $30 Million Convertible Notes Subscription Agreements

    Geneva, Switzerland – October 23, 2024: – Ad-Hoc announcement pursuant to Art. 53 of SIX Listing Rules – WISeKey International Holding Ltd. (“WISeKey”) (SIX: WIHN, NASDAQ: WKEY), a global leader in cybersecurity, digital identity and Internet of Things (IoT) innovations operating as a holding company, today announced that it has signed Convertible Notes Subscription Agreements (“Agreements”) for up to $30 million, via private placements with a select group of institutional investors (the “Investors”).

    Under terms of the Agreements, WISeKey will initially issue convertible notes in the aggregate principal amount of $2,500,000 for subscription by the Investors. WISeKey has the right to request the Investors to subscribe for additional tranches, each additional tranche will be in the aggregate principal total amount of $1,250,000 per Investor, at the date and time determined by WISeKey, subject to certain cool-down and volume-related criteria. Each of the convertible notes under the Agreements has a maturity date of 12 months after the relevant issue date and is convertible at any time at the election of the Investors into WISeKey Class B Shares. The conversion price under the Agreements is equal to the lower of a fixed conversion price as determined in the Agreements and 94% of the lowest daily VWAPs of one Class B Share, as applicable, during the ten (10) consecutive trading days preceding the relevant conversion date.

    Carlos Moreira, Founder and CEO of WISeKey noted, “This new funding provides WISeKey with flexible financing at a competitive cost, which is particularly valuable in the current market environment. It enables us to continue funding the growth and development of our core cybersecurity business and strategic initiatives at each of our subsidiaries. Specifically, WISeSat.Space remains focused on key projects, including the deployment of a low-orbit satellite constellation by 2027 by leveraging cutting-edge technological innovations, and SEALSQ is on track to launch its next-generation post-quantum semiconductors in 2025. Additionally, this financing will support our ongoing work on SEALCOIN, with a second Proof of Concept set for January 2025, which will demonstrate the transfer of tokens via satellite to IoT devices thus accelerating the token’s broader availability on digital exchanges in 2025.” 

    Maxim Group LLC served as the sole placement agent for these private placements.

    About WISeKey
    WISeKey is a Swiss-based computer infrastructure company specializing in cybersecurity, digital identity, blockchain, Internet of Things (IoT) solutions, and post-quantum semiconductors. As a computer infrastructure company, WISeKey provides secure platforms for data and device management across industries like finance, healthcare, and government. It leverages its Public Key Infrastructure (PKI) to ensure encrypted communications and authentication, while also focusing on next-generation security through post-quantum cryptography.

    WISeKey’s work with post-quantum semiconductors is aimed at future-proofing its security solutions against the threats posed by quantum computing. These advanced semiconductors support encryption that can withstand the computational power of quantum computers, ensuring the long-term security of connected devices and critical infrastructure. Combined with its expertise in blockchain and IoT, WISeKey’s post-quantum technologies provide a robust foundation for secure digital ecosystems at the hardware, software, and network levels.

    Disclaimer
    This communication expressly or implicitly contains certain forward-looking statements concerning WISeKey International Holding Ltd and its business. Such statements involve certain known and unknown risks, uncertainties and other factors, which could cause the actual results, financial condition, performance or achievements of WISeKey International Holding Ltd to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. WISeKey International Holding Ltd is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.

    This press release does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, and it does not constitute an offering prospectus within the meaning of the Swiss Financial Services Act (“FinSA”), the FinSa’s predecessor legislation or advertising within the meaning of the FinSA. Investors must rely on their own evaluation of WISeKey and its securities, including the merits and risks involved. Nothing contained herein is, or shall be relied on as, a promise or representation as to the future performance of WISeKey.

    Press and Investor Contacts

    WISeKey International Holding Ltd
    Company Contact: Carlos Moreira
    Chairman & CEO
    Tel: +41 22 594 3000
    info@wisekey.com 
    WISeKey Investor Relations (US) 
    The Equity Group Inc.
    Lena Cati
    Tel: +1 212 836-9611 / lcati@equityny.com
    Katie Murphy
    Tel: +1 212 836-9612 / kmurphy@equityny.com

    The MIL Network

  • MIL-OSI Reportage: Scammers undeterred: 9 in 10 NZers targeted, but reporting surges

    Source: BNZ statements

    New research from BNZ highlights the unrelenting onslaught of criminal scammers facing New Zealanders, with nearly nine in ten Kiwis reporting they’ve been targeted by scammers in the past year. 

    BNZ’s annual Scam Savvy survey found that 87% of New Zealanders were targeted by scams in the past 12 months, virtually unchanged from 2023 (88%).  

    However, in a positive shift, New Zealanders are fighting back: despite persistent attacks, the proportion of people reporting scams to organisations like banks, police, and Netsafe, has jumped to 70%, up from 62% in 2023 and a mere 46% in 2022. 

    BNZ Head of Financial Crime, Ashley Kai Fong, says, “While it’s concerning that scammers continue to target Kiwis at such a high rate, we’re pleased to see a significant increase in scam reporting.  

    “This shift suggests that our efforts to raise awareness and encourage action are paying off. However, it’s crucial to remember that if you suspect you’ve been scammed, you should always call your bank immediately. Quick action can often help prevent or limit financial losses.” 

    Key findings from BNZ’s 2024 Scam Savvy survey include: 

    • Government impersonation scams have increased, with 52% of respondents targeted by this type of scam in the last 12 months, up from 45% in 2023 
    • Email remains the most common scam channel, with 34% of scam victims targeted this way. 
    • Website-based scams have more than doubled, with 22% of scam victims being contacted this way, up from 9% in 2023 
    • Social media remains a significant channel for scammers, with 22% of respondents encountering scams on these platforms 
    • 1 in 8 respondents fell victim to a scam in the last 12 months, with 7% losing money 

    “The tactics used by scammers are constantly evolving, so the increase in reporting is a crucial step in our collective fight against fraud – every report makes it harder for scammers to operate. We’re seeing a real shift in attitudes, with more people recognising the importance of speaking up,” Kai Fong says. 

    In response to the evolving scam landscape, BNZ recently launched another anti-scam tool. The ‘online banking lock’ feature gives customers the ability to disable all online banking activity and lock access to their online banking if they suspect a scammer has gained access to their accounts. 

    “This new tool – available in the BNZ app – gives customers the ability to lock their online banking while they’re contacting us, potentially speeding up the process to lock their accounts and shut scammers out,” says Kai Fong. 

    The online banking lock is just one of a number of new features BNZ has introduced, including: 

    • Introducing a way for customers to verify their identity through the BNZ app when prompted by a BNZ staff member to confirm it is the bank calling. 
    • Introducing additional two-factor authentication (2FA) within internet banking for high-risk actions such as changing personal contact details, creating a new payee, editing an existing payee, or making payments to unsaved payees. This is required regardless of whether a customer has already completed 2FA in their current session. 
    • Deploying ID readers in branch to help identify fraudulent documents. 

    “While we’re making progress and introducing new protective measures, our research underscores the need for continued vigilance and education. We urge all New Zealanders to stay informed about the latest scam tactics and to report any suspicious activity immediately.  

    “Remember, reporting a scam isn’t just about your own protection—it could prevent someone else from becoming a victim too,” says Kai Fong. 

    Keeping account details, passwords and pin numbers safe 

    • never click on links or attachments sent by someone you don’t know or that seem out of character for someone you do know 
    • keep your computer and phone security software up to date 
    • contact your bank as soon as possible if you think you’ve been scammed 

    Top tips to get scam savvy – BNZ will never: 

    • email or text you links to online banking and ask you to log in 
    • send you a text message with a link to a website, or link to call us 
    • ask you for information about your PIN number, bank account number, or password 
    • ask you to verbally share the authentication codes sent to you by text or email, even with a BNZ staff member 
    • ask you to transfer money to help catch a scammer or a bank employee who is scamming customers send you a text message about account issues with a link to log in 
    • ask you to download software to access your Internet Banking remotely 
    • use international phone numbers to call or send you notifications.

    The BNZ Scam Savvy research was commissioned by BNZ using the Insights HQ my2cents online research panel. Responses were collected between July 30 and August 16, 2024, with a sample size of 1,263 New Zealanders. The sample was weighted to be nationally representative on region, age and gender.

    The post Scammers undeterred: 9 in 10 NZers targeted, but reporting surges appeared first on BNZ Debrief.

    MIL OSI Analysis

  • MIL-OSI Security: Denham Springs Man Pleads Guilty to Distribution of Child Pornography

    Source: Office of United States Attorneys

    United States Attorney Ronald C. Gathe, Jr. announced that Barry Paul Vining, age 56, of Denham Springs, Louisiana, pleaded guilty before U.S. District Judge Brian A. Jackson to distribution of child pornography.

    According to admissions made during his plea, on November 27, 2022, Vining knowingly distributed the two images of child pornography when he uploaded them to a file sharing service accessed via the internet, and that allowed other users of the service around the world to download and share the images.  In addition, at the time Vining distributed the child pornography, he possessed files that contained numerous images and videos of child pornography.

    U.S. Attorney Ronald Gathe stated, “Our office will remain steadfast in the prosecution of the horrific crime of child pornography, a crime that preys on the most vulnerable, our youth.  I want to thank our Project Safe Childhood Partners, especially the U. S. Immigration and Customs Enforcement Agency for their hard work in investigating this illegal act.”

    This matter was investigated by the U.S. Immigration and Customs Enforcement and is being prosecuted by Assistant United States Attorney Paul L. Pugliese.

    This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice.  Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.  For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.

    MIL Security OSI

  • MIL-OSI Security: Martin City man charged with producing, distributing child pornography

    Source: Office of United States Attorneys

    MISSOULA — A Martin City man accused of producing and distributing images of a minor engaged in sexually explicit conduct appeared on Oct. 22 for arraignment on charges, U.S. Attorney Jesse Laslovich said today.

    The defendant, Raymond Owen Bonner, Jr., 39, pleaded not guilty to an indictment charging him with production of child pornography and distribution of child pornography. If convicted, Bonner faces a mandatory minimum of 15 years to 30 years in prison, a $250,000 fine and not less than five years to life of supervised release on the production charge, and a mandatory minimum of five years to 20 years in prison, a $250,000 fine and not less than five years to life of supervised release on the distribution charge.

    U.S. Magistrate Judge Kathleen L. DeSoto presided. Bonner was detained pending further proceedings.

    The indictment alleges that between about June 2024 and Sept. 5, 2024 in Martin City, in Flathead County, Bonner coerced a minor, identified as Jane Doe, to engage in sexually explicit conduct for the purpose of producing visual images and that he distributed visual images of a minor engaged in sexually explicit conduct using a computer.

    The U.S. Attorney’s Office is prosecuting the Case. The FBI and Flathead County Sheriff’s Office conducted the investigation.

    This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit Justice.gov/PSC.

    Charging documents are merely accusations and defendants are presumed innocent until proven guilty beyond a reasonable doubt.

    PACER case reference. 24-57.

    The progress of cases may be monitored through the U.S. District Court Calendar and the PACER system. To establish a PACER account, which provides electronic access to review documents filed in a case, please visit http://www.pacer.gov/register.html. To access the District Court’s calendar, please visit https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.

    XXX

    MIL Security OSI

  • MIL-OSI Europe: Press release – EU budget for 2025 to focus on research, health, education, and climate action

    Source: European Parliament

    Parliament demands an EU budget for 2025 that focuses on improving people’s lives, boosting competitiveness, and addressing current challenges.

    MEPs set the overall level of commitment appropriations for the 2025 draft budget at almost €201 billion, €1.24 billion more than the Commission’s proposal from last June. Parliament wants to boost programmes vital in addressing health challenges, supporting young people, agriculture and rural areas, helping people suffering from natural disasters, boosting climate action, managing migration and security needs, and strengthening EU support for neighbouring regions experiencing geopolitical and humanitarian crises. MEPs restored €1.52  billion in funding cuts proposed by the Council, and set payment appropriations at €153.5 billion.

    Repayment costs for the European Recovery Instrument (EURI)

    The EURI repayment costs, which are twice the amount initially forecast for 2025, should not result in reduced funding for essential programmes, like Erasmus+ or R&D, according to Parliament. MEPs want to reverse cuts made by member states to appropriations dedicated to these areas and to use the new “EURI cascade mechanism” introduced by the revision of the EU’s long-term budget . This mechanism is designed to manage escalating Next Generation EU borrowing costs without affecting key initiatives, maintaining the budget’s flexibility and response capacity.

    Quotes

    Victor Negrescu (S&D, Romania), general rapporteur for the EU budget 2025 (for section III – Commission), said: “Today’s vote is a strong signal of support for a citizen-centred EU budget focused on investments in economic development and improving people’s lives. That is why we are asking for an increase of €110 million for actions in the area of health, an additional €70 million for Erasmus, €42 million to protect our citizens against the effects of natural disasters, an additional €96 million for agriculture, €120 million for humanitarian aid, and €110 million for the Eastern and Southern Neighbourhood.”

    Niclas Herbst (EPP, Germany), rapporteur for the other sections, said: “Cybersecurity is vital for EU institutions and has remained a pressing concern since 2023. Another key priority is ensuring that the institutions have enough staff to fulfil new tasks, like for the implementation of the Artificial Intelligence Act. Additionally, improving the security of European External Action Service buildings, particularly in delegations situated in remote and high-risk areas, is essential. To address this, an increase of €37 million is required.”

    Next steps

    The vote initiates three weeks of “conciliation” talks with the Council, with the aim of reaching a deal for next year’s budget, which then has to be voted on by Parliament and signed by its President.

    Background

    Over 90% of the EU budget funds activities in EU countries and beyond, benefiting citizens, regions, farmers, researchers, students, NGOs, and businesses. Unlike national budgets, the EU budget is primarily aimed at investment, to generate growth and opportunities across the European Union.

    The EU serves 27 countries with a total population of 450 million. With these figures in mind, the annual EU budget is actually relatively small – on average €160-180 billion annually in 2021-27. This is comparable to the national budget of Denmark, which serves 5.6 million people, and is about 30% smaller than the budget of Poland, which serves 38 million people. (Source: Commission)

    MIL OSI Europe News

  • MIL-OSI: Logan Ridge Finance Corporation Schedules Third Quarter 2024 Earnings Release and Conference Call

    Source: GlobeNewswire (MIL-OSI)

    NEW YORK, Oct. 23, 2024 (GLOBE NEWSWIRE) — Logan Ridge Finance Corporation (Nasdaq: LRFC) (“LRFC,” “Logan Ridge” or the “Company”) to release its financial results for the third quarter ended September 30, 2024, on Thursday, November 7, 2024, after market close. The Company will host a conference call on Tuesday, November 12, 2024, at 11:00 a.m. ET to discuss these results.

    By Phone: To access the call, please dial (646) 307-1963 approximately 10 minutes prior to the start of the conference call and use the conference ID 1567736.

    A replay of this conference call will be available shortly after the live call through November 19, 2024.

    By Webcast: A live audio webcast of the conference call can be accessed via the Internet, on a listen-only basis at https://edge.media-server.com/mmc/p/qktrwywh. The online archive of the webcast will be available on the Company’s website shortly after the call at www.loganridgefinance.com in the Investor Resources section under Events and Presentations.

    About Logan Ridge Finance Corporation

    Logan Ridge Finance Corporation (Nasdaq: LRFC) is a publicly traded, externally managed investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940. Logan Ridge invests primarily in first lien loans and, to a lesser extent, second lien loans and equity securities issued by lower middle market companies. Logan Ridge Finance Corporation is externally managed by Mount Logan Management, LLC, a wholly owned subsidiary of Mount Logan Capital Inc. Both Mount Logan Management, LLC and Mount Logan Capital Inc. are affiliates of BC Partners Advisors L.P.

    Logan Ridge’s filings with the Securities and Exchange Commission (the “SEC”), earnings releases, press releases and other financial, operational and governance information are available on the Company’s website at loganridgefinance.com.

    Contacts:
    Logan Ridge Finance Corporation
    650 Madison Avenue, 3rd floor
    New York, NY 10022

    Brandon Satoren
    Chief Financial Officer
    Brandon.Satoren@bcpartners.com
    (212) 891-2880

    The Equity Group Inc.
    Lena Cati
    lcati@equityny.com
    (212) 836-9611

    The Equity Group Inc.
    Val Ferraro
    vferraro@equityny.com
    (212) 836-9633

    This press release was published by a CLEAR® Verified individual.

    The MIL Network

  • MIL-OSI: Portman Ridge Finance Corporation Schedules Third Quarter 2024 Earnings Release and Conference Call

    Source: GlobeNewswire (MIL-OSI)

    NEW YORK, Oct. 23, 2024 (GLOBE NEWSWIRE) — Portman Ridge Finance Corporation (Nasdaq: PTMN) (“Portman Ridge” or the “Company”) to release its financial results for the third quarter ended September 30, 2024, on Thursday, November 7, 2024, after market close. The Company will host a conference call on Tuesday, November 12, 2024, at 10:00 a.m. ET to discuss these results.

    By Phone: To access the call, please dial (646) 307-1963 approximately 10 minutes prior to the start of the conference call and use the conference ID 6715408.
       

    A replay of this conference call will be available shortly after the live call through November 19th.

    By Webcast: A live audio webcast of the conference call can be accessed via the Internet, on a listen-only basis at https://edge.media-server.com/mmc/p/ma5zjqpa. The online archive of the webcast will be available on the Company’s website shortly after the call at www.portmanridge.com in the Investor Relations section under Events and Presentations.
       

    About Portman Ridge Finance Corporation

    Portman Ridge Finance Corporation (Nasdaq: PTMN) is a publicly traded, externally managed investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940. Portman Ridge’s middle market investment business originates, structures, finances and manages a portfolio of term loans, mezzanine investments and selected equity securities in middle market companies. Portman Ridge’s investment activities are managed by its investment adviser, Sierra Crest Investment Management LLC, an affiliate of BC Partners Advisors, LP.

    Portman Ridge’s filings with the Securities and Exchange Commission (the “SEC”), earnings releases, press releases and other financial, operational and governance information are available on the Company’s website at www.portmanridge.com

    Contacts:
    Portman Ridge Finance Corporation
    650 Madison Avenue, 3rd floor
    New York, NY 10022
    info@portmanridge.com 

    Brandon Satoren
    Chief Financial Officer
    Brandon.Satoren@bcpartners.com
    (212) 891-2880

    The Equity Group Inc.
    Lena Cati
    lcati@equityny.com
    (212) 836-9611

    The Equity Group Inc.
    Val Ferraro
    vferraro@equityny.com
    (212) 836-9633

    This press release was published by a CLEAR® Verified individual.

    The MIL Network

  • MIL-OSI: Bel Reports Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    Sales and Gross Margin Percentage Above Mid-Point of Expected Ranges
    Provides Q4-24 Sales and Gross Margin Guidance

    WEST ORANGE, N.J., Oct. 23, 2024 (GLOBE NEWSWIRE) — Bel Fuse Inc. (Nasdaq: BELFA and BELFB) today announced preliminary financial results for the third quarter of 2024.

    Third Quarter 2024 Highlights

    • Net sales of $123.6 million compared to $158.7 million in Q3-23
    • Gross profit margin of 36.1%, up from 35.0% in Q3-23
    • Net earnings of $8.1 million versus $19.4 million in Q3-23
    • Adjusted EBITDA of $20.6 million (16.7% of sales) as compared to $29.9 million (18.8% of sales) in Q3-23
    • Repurchased 26,647 shares of Bel stock at an aggregate cost of $1.9 million in Q3-24

    “We were pleased that our third quarter results landed above the midpoint of guidance for both sales and gross margin,” said Daniel Bernstein, President and CEO. “Each of our three product segments performed as expected, given the current market, regulatory and seasonal factors outlined in last quarter’s disclosures and on the Q2 earnings call.

    “During the third quarter, the team focused on a variety of operational and other internal initiatives. With our announcement of the signing our definitive purchase agreement in September, we welcomed Enercon to the Bel family and are positioned to introduce new customers, end markets and geographies to our Power segment upon the closing expected later this quarter. In a project scheduled to be completed during the first quarter of 2025, our fuse manufacturing, located in China, will be consolidated into other existing Bel facilities thus reducing our footprint further. The fuse initiative is anticipated to achieve annual cost savings of approximately $1.5 million once completed. We are also pleased to announce the addition of two senior associates in newly-created positions to Bel’s corporate team. Uma Pengali has joined as Global Head of Sales and Marketing and Anubhav Gothi has joined as Bel’s Global Head of Contracts. We believe Uma and Anubhav will be instrumental contributors to Bel’s long-term success,” concluded Mr. Bernstein.

    Farouq Tuweiq, CFO, added, “We have started to see positive trends in bookings during the months of September and October across each of our product segments, which is a positive indicator as we enter 2025. These green shoots are largely in our networking and industrial markets, and in the distribution channel. Looking to the fourth quarter of 2024, we expect GAAP net sales in the range of $117 to $125 million with gross margins of approximately 34 – 36%, based on information available as of today. This guidance excludes any potential incremental contribution related to the previously-announced acquisition of Enercon, which is expected to close during the fourth quarter.

    “Overall, we are encouraged by the sequential improvement in market conditions that we are seeing and believe this will bode well for 2025. We are excited to continue our journey of growth and continuous improvement with our new team members,” concluded Mr. Tuweiq.

    Non-GAAP financial measures, such as Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA, adjust corresponding GAAP measures for provision for income taxes, interest expense, and depreciation and amortization, and also exclude, where applicable for the covered period presented in the financial statements, certain unusual or special items identified by management such as restructuring charges, gains/losses on sales of businesses and properties, acquisition related costs, and certain litigation costsNon-GAAP adjusted net sales exclude expedite fee revenue. Please refer to the financial information included with this press release for reconciliations of GAAP financial measures to Non-GAAP financial measures and our explanation of why we present Non-GAAP financial measures.

    Conference Call
    Bel has scheduled a conference call for 8:30 a.m. ET on Thursday, October 24, 2024 to discuss these results. To participate in the conference call, investors should dial 877-407-0784, or 201-689-8560 if dialing internationally. The presentation will additionally be broadcast live over the Internet and will be available at https://ir.belfuse.com/events-and-presentations. The webcast will be available via replay for a period of at least 30 days at this same Internet address. For those unable to access the live call, a telephone replay will be available at 844-512-2921, or 412-317-6671 if dialing internationally, using access code 13749258 after 12:30 pm ET, also for 30 days.

    About Bel
    Bel (www.belfuse.com) designs, manufactures and markets a broad array of products that power, protect and connect electronic circuits. These products are primarily used in the networking, telecommunications, computing, general industrial, high-speed data transmission, military, commercial aerospace, transportation and eMobility industries. Bel’s portfolio of products also finds application in the automotive, medical, broadcasting and consumer electronics markets. Bel’s product groups include Magnetic Solutions (integrated connector modules, power transformers, power inductors and discrete components), Power Solutions and Protection (front-end, board-mount and industrial power products, module products and circuit protection), and Connectivity Solutions (expanded beam fiber optic, copper-based, RF and RJ connectors and cable assemblies). The Company operates facilities around the world.

    Company Contact:
    Farouq Tuweiq  
    Chief Financial Officer  
    ir@belf.com

    Investor Contact:
    Three Part Advisors
    Jean Marie Young, Managing Director or Steven Hooser, Partner
    631-418-4339
    jyoung@threepa.com; shooser@threepa.com

    Cautionary Language Concerning Forward-Looking Statements
    This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, our guidance for the fourth quarter of 2024, and our statements regarding our expectations for future periods generally including anticipated financial performance, projections and trends for the remainder of the year and other future periods including 2025, and our statements regarding future events, performance, plans, intentions, beliefs, expectations and estimates, including statements regarding matters such as trends and expectations as to our sales, gross margin, products, product segments, customers, end markets, geographies and bookings, statements regarding our views and expectations about the impact of market trends and seasonal factors, statements about the closing of the Enercon Technologies, Ltd. (“Enercon”) acquisition including the anticipated timing thereof, and statements about the anticipated benefits and impact of the Enercon acquisition including in terms of introducing new customers, end markets and geographies to our Power segment, as well as any potential incremental contribution by Enercon post-closing to Bel’s financial results, statements regarding consolidation projects and initiatives, the expected timing of implementation and completion thereof, and the anticipated projections of cost savings to be realized thereby, statements about future contributions of new employees and the role of newly-created positions in the corporate team in contributing to Bel’s long-term success, statements regarding our expectations and beliefs regarding trends in the Company’s business and industry and the markets in which Bel operates, and about the broader economy and macroeconomic environment generally, including statements about trends in bookings and views about indicators of economic conditions including as to particular sectors or markets, improvement in market conditions, and statements about Bel’s growth and improvement, and other statements regarding the Company’s positioning, its strategies, future progress, investments, plans, targets, goals, and other focuses and initiatives, and the expected timing and potential benefits thereof. These forward-looking statements are made as of the date of this release and are based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “forecast,” “outlook,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Bel’s control. Bel’s actual results could differ materially from those stated or implied in our forward-looking statements (including without limitation any of Bel’s projections) due to a number of factors, including but not limited to, unanticipated difficulties, delays or expenditures relating to the proposed Enercon acquisition, including, without limitation, difficulties that result in the failure to realize the expected benefits and synergies within the expected time period (if at all); disruptions of Bel’s or Enercon’s current plans, operations and relationships with customers, suppliers, distributors, business partners and regulators caused by the announcement and pendency of the proposed Enercon acquisition; potential difficulties in employee retention due to the announcement and pendency of the proposed Enercon acquisition; the possibility that the proposed Enercon acquisition does not close, including, but not limited to, failure to satisfy the closing conditions; the market concerns facing our customers, and risks for the Company’s business in the event of the loss of certain substantial customers; the continuing viability of sectors that rely on our products; the effects of business and economic conditions, and challenges impacting the macroeconomic environment generally and/or our industry in particular; the effects of rising input costs, and cost changes generally, including the potential impact of inflationary pressures; difficulties associated with integrating previously acquired companies, and any difficulties that may be experienced in integrating Enercon following the closing of the Enercon acquisition; capacity and supply constraints or difficulties, including supply chain constraints or other challenges; the impact of public health crises (such as the governmental, social and economic effects of COVID or other future epidemics or pandemics); difficulties associated with the availability of labor, and the risks of any labor unrest or labor shortages; risks associated with our international operations, including our substantial manufacturing operations in China, and following the acquisition of Enercon, risks associated with operations in Israel, which may be adversely affected by political or economic instability, major hostilities or acts of terrorism in the region; risks associated with restructuring programs or other strategic initiatives, including any difficulties in implementation or realization of the expected benefits or cost savings; product development, commercialization or technological difficulties; the regulatory and trade environment including the potential effects of trade restrictions that may impact Bel, its customers and/or its suppliers; risks associated with fluctuations in foreign currency exchange rates and interest rates; uncertainties associated with legal proceedings; the market’s acceptance of the Company’s new products and competitive responses to those new products; the impact of changes to U.S. and applicable foreign legal and regulatory requirements, including tax laws, trade and tariff policies; and the risks detailed in Bel’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and in subsequent reports filed by Bel with the Securities and Exchange Commission, as well as other documents that may be filed by Bel from time to time with the Securities and Exchange Commission. In light of the risks and uncertainties impacting our business, there can be no assurance that any forward-looking statement will in fact prove to be correct. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Bel’s views as of the date of this press release. Bel anticipates that subsequent events and developments will cause its views to change. Bel undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Bel’s views as of any date subsequent to the date of this press release.

    Non-GAAP Financial Measures
    The Non-GAAP financial measures identified in this press release as well as in the supplementary information to this press release (Non-GAAP adjusted net sales, Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA) are not measures of performance under accounting principles generally accepted in the United States of America (“GAAP”). These measures should not be considered a substitute for, and the reader should also consider, income from operations, net earnings, earnings per share and other measures of performance as defined by GAAP as indicators of our performance or profitability. Our non-GAAP measures may not be comparable to other similarly-titled captions of other companies due to differences in the method of calculation. We present results adjusted to exclude the effects of certain unusual or special items and their related tax impact that would otherwise be included under U.S. GAAP, to aid in comparisons with other periods. We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and results of operations. We use these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis and for budgeting and planning purposes. We also believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other similarly situated companies in our industry, many of which present similar non-GAAP financial measures to investors. We also use non-GAAP measures in determining incentive compensation. For additional information about our use of non-GAAP financial measures in connection with our Incentive Compensation Program for 2023, please see the Executive Compensation discussion appearing in our Definitive Proxy Statement filed with the Securities and Exchange Commission on April 1, 2024.

    Website Information
    We routinely post important information for investors on our website, www.belfuse.com, in the “Investor Relations” section. We use our website as a means of disclosing material, otherwise non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, Securities and Exchange Commission (SEC) filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this document.

    [Financial tables follow]

               
               
    Bel Fuse Inc.
    Supplementary Information(1)
    Condensed Consolidated Statements of Operations
    (in thousands, except per share amounts)
    (unaudited)
               
      Three Months Ended     Nine Months Ended  
      September 30,     September 30,  
      2024     2023     2024     2023  
                                   
    Net sales $ 123,638     $ 158,682     $ 384,933     $ 499,803  
    Cost of sales   78,961       103,217       238,782       335,137  
    Gross profit   44,677       55,465       146,151       164,666  
    As a % of net sales   36.1 %     35.0 %     38.0 %     32.9 %
                                   
    Research and development costs   5,443       5,292       16,652       16,521  
    Selling, general and administrative expenses   26,700       23,717       75,785       74,149  
    As a % of net sales   21.6 %     14.9 %     19.7 %     14.8 %
    Restructuring charges   1,087       2,091       1,790       6,306  
    Gain on sale of property         (147 )           (3,819 )
    Income from operations   11,447       24,512       51,924       71,509  
    As a % of net sales   9.3 %     15.4 %     13.5 %     14.3 %
                                   
    Gain on sale of Czech Republic business         (135 )           980  
    Interest expense   (414 )     (512 )     (1,263 )     (2,402 )
    Interest income   1,480             3,741        
    Other income/expense, net   (1,325 )     (96 )     21       (286 )
    Earnings before income taxes   11,188       23,769       54,423       69,801  
                                   
    Provision for income taxes   3,108       4,321       11,663       8,006  
    Effective tax rate   27.8 %     18.2 %     21.4 %     11.5 %
    Net earnings $ 8,080     $ 19,448     $ 42,760     $ 61,795  
    As a % of net sales   6.5 %     12.3 %     11.1 %     12.4 %
                                   
    Weighted average number of shares outstanding:                              
    Class A common shares – basic and diluted   2,116       2,142       2,126       2,142  
    Class B common shares – basic and diluted   10,434       10,636       10,512       10,636  
                                   
    Net earnings per common share:                              
    Class A common shares – basic and diluted $ 0.61     $ 1.46     $ 3.23     $ 4.63  
    Class B common shares – basic and diluted $ 0.65     $ 1.54     $ 3.41     $ 4.88  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Condensed Consolidated Balance Sheets
    (in thousands, unaudited)
     
      September 30, 2024     December 31, 2023  
    Assets              
    Current assets:              
    Cash and cash equivalents $ 134,266     $ 89,371  
    Held to maturity U.S. Treasury securities   29,541       37,548  
    Accounts receivable, net   75,998       84,129  
    Inventories   124,885       136,540  
    Other current assets   22,959       33,890  
    Total current assets   387,649       381,478  
    Property, plant and equipment, net   36,735       36,533  
    Right-of-use assets   22,901       20,481  
    Related-party note receivable   3,070       2,152  
    Equity method investment   10,014       10,282  
    Goodwill and other intangible assets, net   72,772       76,033  
    Other assets   51,276       44,672  
    Total assets $ 584,417     $ 571,631  
                   
    Liabilities and Stockholders’ Equity              
    Current liabilities:              
    Accounts payable $ 37,139     $ 40,441  
    Operating lease liability, current   6,451       6,350  
    Other current liabilities   53,297       63,818  
    Total current liabilities   96,887       110,609  
    Long-term debt   60,000       60,000  
    Operating lease liability, long-term   16,808       14,212  
    Other liabilities   43,360       46,252  
    Total liabilities   217,055       231,073  
    Stockholders’ equity   367,362       340,558  
    Total liabilities and stockholders’ equity $ 584,417     $ 571,631  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Condensed Consolidated Statements of Cash Flows
    (in thousands, unaudited)
         
      Nine Months Ended  
      September 30,  
      2024     2023  
                   
    Cash flows from operating activities:              
    Net earnings $ 42,760     $ 61,795  
    Adjustments to reconcile net earnings to net cash provided by operating activities:              
    Depreciation and amortization   10,759       9,962  
    Stock-based compensation   2,782       2,712  
    Amortization of deferred financing costs   27       33  
    Deferred income taxes   (5,366 )     (4,894 )
    Net unrealized losses on foreign currency revaluation   1,275       130  
    Gain on sale of property         (3,819 )
    Gain on sale of Czech Republic business         (980 )
    Other, net   628       (495 )
    Changes in operating assets and liabilities:              
    Accounts receivable, net   8,366       11,931  
    Unbilled receivables   7,482       1,590  
    Inventories   12,266       29,313  
    Accounts payable   (3,302 )     (18,674 )
    Accrued expenses   (11,849 )     4,536  
    Accrued restructuring costs   (590 )     (148 )
    Income taxes payable   4,809       2,008  
    Other operating assets/liabilities, net   (4,327 )     (13,575 )
    Net cash provided by operating activities   65,720       81,425  
                   
    Cash flows from investing activities:              
    Purchases of property, plant and equipment   (7,906 )     (9,659 )
    Purchases of held to maturity U.S. Treasury securities   (131,309 )      
    Proceeds from held to maturity securities   139,316        
    Payment for equity method investment         (9,975 )
    Investment in related party notes receivable   (918 )     (1,905 )
    Proceeds from sale of property, plant and equipment   236       5,403  
    Proceeds from sale of business         5,063  
    Net cash used in investing activities   (581 )     (11,073 )
                   
    Cash flows from financing activities:              
    Dividends paid to common stockholders   (2,487 )     (2,490 )
    Deferred financing costs   (330 )      
    Repayments under revolving credit line         (40,000 )
    Borrowings under revolving credit line         5,000  
    Purchases of common stock   (16,053 )      
    Net cash used in financing activities   (18,870 )     (37,490 )
                   
    Effect of exchange rate changes on cash and cash equivalents   (1,374 )     (2,903 )
                   
    Net increase in cash and cash equivalents   44,895       29,959  
    Cash and cash equivalents – beginning of period   89,371       70,266  
    Cash and cash equivalents – end of period $ 134,266     $ 100,225  
                   
                   
    Supplementary information:              
    Cash paid during the period for:              
    Income taxes, net of refunds received $ 15,556     $ 18,148  
    Interest payments $ 3,010     $ 3,738  
    ROU assets obtained in exchange for lease obligations $ 4,711     $ 5,887  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Product Group Highlights
    (dollars in thousands, unaudited)
     
      Sales     Gross Margin  
      Q3-24     Q3-23     % Change     Q3-24     Q3-23     Basis Point Change  
    Power Solutions and Protection $ 48,680     $ 74,862       -35.0 %     39.4 %     41.7 %     (230 )
    Connectivity Solutions   55,715       51,771       7.6 %     36.6 %     35.8 %     80  
    Magnetic Solutions   19,243       32,049       -40.0 %     27.3 %     22.0 %     530  
    Total $ 123,638     $ 158,682       -22.1 %     36.1 %     35.0 %     110  
      Sales     Gross Margin  
      YTD September 2024     YTD September 2023     % Change     YTD September 2024     YTD September 2023     Basis Point Change  
    Power Solutions and Protection $ 167,478       245,134       -31.7 %     43.2 %     37.5 %     570  
    Connectivity Solutions   167,822       160,010       4.9 %     37.3 %     35.8 %     150  
    Magnetic Solutions   49,633       94,659       -47.6 %     23.9 %     23.0 %     90  
    Total $ 384,933     $ 499,803       -23.0 %     38.0 %     32.9 %     510  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Reconciliation of GAAP Net Sales to Non-GAAP Adjusted Net Sales(2)
    Reconciliation of GAAP Net Earnings to EBITDA and Adjusted EBITDA(2)
    (in thousands, unaudited)
               
      Three Months Ended     Nine Months Ended  
      September 30,     September 30,  
      2024     2023     2024     2023  
                                   
    GAAP net sales $ 123,638     $ 158,682     $ 384,933     $ 499,803  
    Expedite fee revenue         1,008       57       14,425  
    Non-GAAP adjusted net sales $ 123,638     $ 157,674     $ 384,876     $ 485,378  
      Three Months Ended     Nine Months Ended  
      September 30,     September 30,  
      2024     2023     2024     2023  
                                   
    GAAP Net earnings $ 8,080     $ 19,448     $ 42,760     $ 61,795  
    Interest expense   414       512       1,263       2,402  
    Provision for income taxes   3,108       4,321       11,663       8,006  
    Depreciation and amortization   3,636       3,391       10,759       9,962  
    EBITDA $ 15,238     $ 27,672     $ 66,445     $ 82,165  
    % of net sales   12.3 %     17.4 %     17.3 %     16.4 %
                                   
    Unusual or special items:                              
    Restructuring charges   1,087       2,091       1,790       6,306  
    MPS litigation costs         132             2,903  
    Gain on sale of Czech Republic business         135             (980 )
    Gain on sale of properties         (147 )           (3,819 )
    Acquisition related costs   4,292             4,292        
    Adjusted EBITDA $ 20,617     $ 29,883     $ 72,527     $ 86,575  
    % of net sales   16.7 %     18.8 %     18.8 %     17.3 %
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
    (2) In this press release and supplemental information, we have included Non-GAAP financial measures, including Non-GAAP adjusted net sales, Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA. We present results adjusted to exclude the effects of certain specified items and their related tax impact that would otherwise be included under GAAP, to aid in comparisons with other periods. We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and results of operations. We use these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis and for budgeting and planning purposes. We also believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other similarly situated companies in our industry, many of which present similar non-GAAP financial measures to investors. We also use non-GAAP measures in determining incentive compensation. See the section above captioned “Non-GAAP Financial Measures” for additional information.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Reconciliation of GAAP Measures to Non-GAAP Measures(2)
    (in thousands, except per share data) (unaudited)
     
    The following tables detail the impact that certain unusual or special items had on the Company’s net earnings per common Class A and Class B basic and diluted shares (“EPS”) and the line items in which these items were included on the consolidated statements of operations.
     
        Three Months Ended September 30, 2024     Three Months Ended September 30, 2023  
    Reconciling Items   Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)     Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)  
                                                                                     
    GAAP measures   $ 11,188     $ 3,108     $ 8,080     $ 0.61     $ 0.65     $ 23,769     $ 4,321     $ 19,448     $ 1.46     $ 1.54  
    Restructuring charges     1,087       154       933       0.07       0.07       2,091       407       1,684       0.13       0.13  
    MPS litigation costs                                   132       30       102       0.01       0.01  
    Gain on sale of Czech Republic business                                   135       7       128       0.01       0.01  
    Gain on sale of properties                                   (147 )     (29 )     (118 )     (0.01 )     (0.01 )
    Acquisition related costs     4,292       987       3,305       0.25       0.27                                
    Non-GAAP measures   $ 16,567     $ 4,249     $ 12,318     $ 0.94     $ 0.99     $ 25,980     $ 4,736     $ 21,244     $ 1.59     $ 1.68  
        Nine Months Ended September 30, 2024     Nine Months Ended September 30, 2023  
    Reconciling Items   Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)     Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)  
                                                                                     
    GAAP measures   $ 54,423     $ 11,663     $ 42,760     $ 3.23     $ 3.41     $ 69,801     $ 8,006     $ 61,795     $ 4.63     $ 4.88  
    Restructuring charges     1,790       317       1,473       0.11       0.12       6,306       1,007       5,299       0.40       0.42  
    MPS litigation costs                                   2,903       667       2,236       0.17       0.18  
    Gain on sale of Czech Republic business                                   (980 )     (49 )     (931 )     (0.07 )     (0.07 )
    Gain on sale of properties                                   (3,819 )     (763 )     (3,056 )     (0.23 )     (0.24 )
    Acquisition related costs     4,292       987       3,305       0.25       0.26                                
    Non-GAAP measures   $ 60,505     $ 12,967     $ 47,538     $ 3.59     $ 3.80     $ 74,211     $ 8,868     $ 65,343     $ 4.89     $ 5.16  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
    (2) In this press release and supplemental information, we have included Non-GAAP financial measures, including Non-GAAP adjusted net sales, Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA. We present results adjusted to exclude the effects of certain specified items and their related tax impact that would otherwise be included under GAAP, to aid in comparisons with other periods. We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and results of operations. We use these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis and for budgeting and planning purposes. We also believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other similarly situated companies in our industry, many of which present similar non-GAAP financial measures to investors. We also use non-GAAP measures in determining incentive compensation. See the section above captioned “Non-GAAP Financial Measures” for additional information.
    (3) Individual amounts of earnings per share may not agree to the total due to rounding.
     

    The MIL Network

  • MIL-OSI Security: Casper man sentenced to 10 years for transportation of a minor for sex

    Source: Office of United States Attorneys

    James Warren Martin, 38, of Casper, Wyoming, was sentenced to 10 years in federal prison, with a lifetime of supervised release, for transportation of a minor with intent to engage in criminal sexual activity. This sentence is to run concurrently with his 37-to-45-year sentence imposed in Wyoming’s Seventh Judicial District state court for his victimization of the same minor. Chief U.S. District Court Judge Scott W. Skavdahl imposed the sentence on Jan. 23, in Casper.

    According to court documents, the defendant was brought to the attention of law enforcement in October of 2022 when the minor victim’s family member and guardian reported to the Casper Police Department that a male, identified as James Warren Martin, was grooming the girl. Detectives began investigating Martin. Then, on Nov. 16, 2022, Martin picked up the girl from school and fled the state with her. An Amber Alert was issued in Wyoming. Investigators determined that Martin and the minor victim may have been in Arizona. An Amber Alert was also issued in Arizona.

    A deputy with the La Paz County (Ariz.) Sheriff’s Office located Martin and the minor victim in Arizona. Law enforcement arrested Martin and rescued the girl. Electronic evidence showed Martin intended to take the girl to Mexico. Evidence also proved Martin had sexual intercourse with the girl after taking her from Wyoming. Martin was interviewed and ultimately confessed to having sexual intercourse with the girl numerous times in Natrona County, Wyoming in the years before taking her to Arizona.

    Martin was indicted on Jan. 11, 2023, and entered federal custody on July 15, 2024. He pleaded guilty on Oct. 29, 2024.

    The Casper Police Department, Federal Bureau of Investigation, Wyoming Division of Criminal Investigation, and La Paz County Sheriff’s Office in Arizona investigated the crime. Assistant U.S. Attorney Z. Seth Griswold prosecuted the federal crime. The Natrona County District Attorney’s Office prosecuted the accompanying state crimes.

    This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice.  Led by the U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.

    Case No. 23-CR-00005

    MIL Security OSI

  • MIL-OSI USA: Fort Mill man arrested on Child Sexual Abuse Material* and related chargesRead More

    Source: US State of South Carolina

    (COLUMBIA, S.C.) – South Carolina Attorney General Alan Wilson announced the arrest of Wesley Keith Zimmer, 30, of Fort Mill, S.C., on five charges connected to the sexual exploitation of a minor. Internet Crimes Against Children (ICAC) Task Force investigators with the York County Sheriff’s Office made the arrest. Investigators with the Attorney General’s Office, also a member of the state’s ICAC Task Force, the Greenup County Sheriff’s Office, and the Russell Police Department, both out of Kentucky, all assisted with the investigation.

     

    Investigators received a CyberTipline report from the National Center for Missing and Exploited Children (NCMEC), which led them to Zimmer. Investigators state Zimmer produced child sexual abuse material, distributed and possessed files of child sexual abuse material, and sent sexually explicit images to a minor.

     

    Zimmer was arrested on January 23, 2025. He is charged with one count of sexual exploitation of a minor, first degree (§16-15-395), a felony offense punishable by up to 20 years imprisonment; one count of sexual exploitation of a minor, second degree (§16-15-405), a felony offense punishable by up to 10 years imprisonment; two counts of sexual exploitation of a minor, third degree (§16-15-410), a felony offense punishable by up to 10 years imprisonment on each count; and one count of dissemination of obscene material to a person under age eighteen (§16-15-345), a felony offense punishable by up to 10 years imprisonment.

     

     

    This case will be prosecuted by the Attorney General’s Office.

     

    Attorney General Wilson stressed all defendants are presumed innocent unless and until they are proven guilty in a court of law.

     

     

     

    * Child sexual abuse material, or CSAM, is a more accurate reflection of the material involved in these heinous and abusive crimes. “Pornography” can imply the child was a consenting participant.  Globally, the term child pornography is being replaced by CSAM for this reason.

    MIL OSI USA News

  • MIL-OSI Asia-Pac: Coal Secretary Inaugurates Smart Classrooms under CIL’s CSR initiative

    Source: Government of India (2)

    Coal Secretary Inaugurates Smart Classrooms under CIL’s CSR initiative

    Multiple CSR Initiatives by Coal India Subsidiaries Launched in Educational Sector

    Posted On: 24 JAN 2025 6:12PM by PIB Delhi

    Secretary, Ministry of Coal Shri Vikram Dev Dutt today virtually inaugurated digital classrooms of government schools in Jharkhand, installed under ‘Digi Vidya’, a CSR initiative of Coal India subsidiaries.

    Shri PM Prasad, Chairman, CIL, Smt. Rupinder Brar, Additional Secretary, MoC, Ms Santosh, Deputy Director General, MoC, Shri Samiran Dutta, CMD, Bharat Coking Coal Limited (BCCL), Shri Nilendu Kumar Singh, CMD, Central Coalfields Limited (CCL) and other senior officers of the ministry of coal and CIL and its subsidiaries were present at the occasion.

    ‘Digi Vidya’ aims to ensure students of schools situated in mining areas of eight states where CIL’s subsidiaries operates get quality education and none of them are left behind in the journey of ‘Viksit Bharat’. In the first phase, 272 government schools were upgraded under Digi Vidya with Smart classrooms. More schools will be added in upcoming phases.

    Bharat Cooking Coal Ltd (BCCL) has implemented Smart Classrooms and ICT labs in 79 schools of Dhanbad district, with an investment of over Rs. 10.69 crores. It aims to enhance the education landscape, benefitting more than 1,00,000 students and 400 teachers by providing them with personalised, engaging and technology driven learning experience.  CCL, another Jharkhand-based subsidiary of CIL, is implementing Digi Vidya in 193 schools, situated in Chatra, Bokaro, Ramgarh, Pakur, Hazaribagh, Latehar, Ranchi and Giridih.

    While addressing the gathering, Shri Vikram Dev Dutt, Secretary, Ministry of Coal said that the digital classrooms enable students in remote and under privileged areas to access quality education resources. “In coming days, exposure to digital tools in the classroom prepares students for a technology driven future. The teachers and students can access global knowledge and stay updated with the latest education trends,” Shri Dutt said.

    Smt. Rupinder Brar, Additional Secretary said that introducing digital classrooms will be a game-changer for students studying in remote areas. “Students will have access of same quality education as urban schools. They will be taught through digital mode, which will help them understand the concepts better and improve learning,” she said.

    Shri PM Prasad, Chairman, CIL termed the initiative as an effort to ensure inclusive and equitable education focusing in remote areas.

    Under the CSR initiative of CMPDI, 20 students sponsored by CMPDI, Ranchi, successfully completed the two-year Diploma in Ophthalmic Assistant Program at LNJP Paramedical Institute, Bahera. Certificates were awarded by Shri Ajay Kumar, Director (T/P&D), and Shri R.K. Mahapatra, General Manager (HRD/CSR), CMPDI.  Shri Ajay Kumar stated, “This initiative reflects CMPDI’s commitment to supporting higher education opportunities for rural youth, enabling them to build meaningful careers and contribute to society.”

    Mahanadi Coalfields Limited (MCL), as part of its CSR initiative, has launched “Project Sambalpur Sikshotthan – MCL Ke Shayog Say” to significantly improve the educational infrastructure in Sambalpur district. In this connection, an MoU was signed between MCL and the District Administration, Sambalpur, marking the commencement of the project.

    Under this initiative, 20,617 dual desk benches will be provided for 809 elementary schools in the district. This project, valued at ₹22.51 crore, will directly benefit over 40,000 students annually by providing proper sitting arrangements.

    Northern Coalfields Limited (NCL) launched a project worth Rs. 1.46 Crore in the operational district of Sonbahdra (U.P) covering the renovation of infrastructure of three schools.

    As part of Coal India & WCL’s Golden Jubilee Celebrations, WCL launched The Happy School project at Dr. Ram Manohar Lohia Government School. The project aims to redesign Government Schools using the innovative Building as Learning Aid (BaLA) concept. As a pilot, five Nagpur Municipal Corporation (NMC) schools were selected for the project benefiting 1,055 students. Golden Jubilee Celebrations took place across 10 areas of WCL where various competitive events, launch of Education themed CSR Projects, Workshops & Sports tournaments for children were organised.

    These CSR projects highlight the commitment of CIL and its subsidiaries towards the social upbringing of communities living in mining affected areas.

    ****

    Shuhaib T

    (Release ID: 2095895) Visitor Counter : 63

    MIL OSI Asia Pacific News

  • MIL-OSI Europe: Debates – Thursday, 23 January 2025 – Strasbourg – Revised edition

    Source: European Parliament

    Verbatim report of proceedings
     344k  764k
    Thursday, 23 January 2025 – Strasbourg
    1. Opening of the sitting
      2. Combating Desertification: 16th session of the Conference of the Parties (COP16) of the United Nations Convention (debate)
      3. Resumption of the sitting
      4. Cryptocurrencies – need for global standards (debate)
      5. Resumption of the sitting
      6. Composition of new committees
      7. Composition of committees and delegations
      8. Voting time
        8.1. Case of Jean-Jacques Wondo in the Democratic Republic of the Congo (RC-B10-0069/2025, B10-0065/2025, B10-0069/2025, B10-0070/2025, B10-0072/2025, B10-0078/2025, B10-0081/2025, B10-0084/2025) (vote)
        8.2. Systematic repression of human rights in Iran, notably the cases of Pakhshan Azizi and Wrisha Moradi, and the taking of EU citizens as hostages (RC-B10-0066/2025, B10-0063/2025, B10-0066/2025, B10-0067/2025, B10-0073/2025, B10-0082/2025, B10-0085/2025, B10-0086/2025) (vote)
        8.3. Case of Boualem Sansal in Algeria (RC-B10-0087/2025, B10-0087/2025, B10-0088/2025, B10-0089/2025, B10-0090/2025, B10-0091/2025, B10-0092/2025, B10-0093/2025) (vote)
        8.4. Russia’s disinformation and historical falsification to justify its war of aggression against Ukraine (RC-B10-0074/2025, B10-0074/2025, B10-0075/2025, B10-0076/2025, B10-0077/2025, B10-0079/2025) (vote)
        8.5. Situation in Venezuela following the usurpation of the presidency on 10 January 2025 (RC-B10-0064/2025, B10-0064/2025, B10-0068/2025, B10-0071/2025, B10-0080/2025, B10-0083/2025) (vote)
      9. Resumption of the sitting
      10. Approval of the minutes of the previous sitting
      11. Major interpellations (debate)
      12. Explanations of votes
      13. Approval of the minutes of the sitting and forwarding of texts adopted
      14. Dates of forthcoming sittings
      15. Closure of the sitting
      16. Adjournment of the session

       

    PRÉSIDENCE: YOUNOUS OMARJEE
    Vice-Président

     
    1. Opening of the sitting

       

    (La séance est ouverte à 09h01)

     

    2. Combating Desertification: 16th session of the Conference of the Parties (COP16) of the United Nations Convention (debate)


     

      Jessika Roswall, Member of the Commission. – Mr President, honourable Members, healthy soils are fundamental for our collective future. Without rich and fertile soils, we have no food and many farmers have their livelihoods affected. We must pay more attention to combating land degradation and enhancing drought resilience for our economy and for our security.

    Europe is not immune to these issues. One of our key political priorities for the coming mandate, the new water resilience strategy, comes from the realisation that our European and global waters are under unsustainable pressure. At the same time, our Joint Research Centre Soil Observatory notes that at least 62 % of EU soils are affected by degradation.

    Droughts have substantial impacts on nearly all regions of the EU. This is why I travelled to Riyadh for the opening of the desertification COP16 on my first day as European Commissioner. I wanted to send a strong signal of the EU’s clear commitment to multilateralism and to cooperation with international partners on our key environmental challenges.

    The desertification COP followed the two meetings of the climate and biodiversity COPs. The day before it started, countries failed to agree on a global treaty on plastic pollution. On desertification, despite the EU’s strong engagement, we reached a mixed result in Riyadh. Parties were not able to reach a compromise on the main topic on the agenda – an instrument to address droughts. It is disappointing that we cannot bridge our differences and reach consensus on such critical issues.

    We were also disappointed in the outcome on gender and civil society organisations. The participation of these organisations increases transparency and democratic accountability. Their contribution is essential. However, some countries increasingly challenge the role and contributions of civil society organisations.

    Finally, we were disappointed that the parties were reluctant to embrace synergies across the three Rio Conventions on desertification, climate and biodiversity.

    However, we did also make progress on several fronts, and every bit of multilateral success is worth celebrating. We reached an agreement on establishing the Science-Policy Interface as a permanent body. We also adopted decisions on land tenure, on migration related to desertification, land degradation and droughts, and on avoiding, reducing and reversing degradation on agricultural land. It was the first time in the history of the Convention that agricultural land degradation was addressed. We must look at sustainable agricultural practices and healthy land together.

    Finally, after a 10‑year freeze, the parties agreed to increase the core budget of the Convention. This is an important step to ensure that global challenges like desertification, drought and water scarcity are properly addressed in the multilateral agenda.

    The EU is contributing to the concrete implementation of the Convention, particularly through our continued support for the Great Green Wall, an inspiring UNCCD flagship initiative that the EU is proud to champion. Building on this commitment, the EU has launched the second phase of the UN World Restoration Flagship, Regreening Africa, which is a key contribution to the Green Wall Initiative.

    Honourable Members, the EU and its Member States will need to step up efforts to protect our values and implement international commitments in the UNCCD and within the EU. In this regard, I am happy to report that the Commission is responding to the commitments of the European Court of Auditors by developing a methodology to assess land degradation and certification for the EU. This will require careful preparation and strategic alliances. We need to address land use, climate change, biodiversity loss, water scarcity and pollution in a coherent manner.

    Honourable Members, these are reflections from my first ever COP, and I am convinced that this COP on desertification needs to be more central. We also cannot look at the outcome of Riyadh without acknowledging that international negotiations have become more difficult, more complex and interconnected when the world is facing several ecological crises. Biodiversity, climate, food, water and energy challenges are all interconnected with land use.

    I’m now looking forward to hearing your views.

     
       

     

      Carmen Crespo Díaz, en nombre del Grupo PPE. – Señor presidente, señora comisaria, gracias por el empuje al tema del agua desde la nueva Comisión. Creemos que es fundamental. Yo soy de una tierra desértica, al lado del desierto de Europa de Tabernas, y allí se demuestra con la huerta de Europa —porque el 80 % del producto de frutas y hortalizas se exporta desde allí —que es posible abordar esta cuestión. ¿Por qué? Porque hay veinte veces menor huella hídrica en todos los productos agroalimentarios.

    Ese es el gran milagro: que para las infraestructuras hidráulicas se utilicen los fondos Next Generation, el Banco Europeo de Inversiones y se creen infraestructuras donde la ciencia, con todo lo que se está investigando, permita. Creo en estos momentos que es fundamental prestar atención a todas las fuentes hídricas: todas son necesarias, algunas en prevención y otras adecuadas a las cuestiones agrarias. Creo que es importantísima la economía circular, y las aguas residuales nos dan una oportunidad en Europa de tener agua regenerada, que incluso podemos inyectar a nuestra hucha del futuro, que son, en este caso, todas las aguas subterráneas.

    Por ello, creo que se puede hacer, que tenemos la obligación de hacerlo y que, además, en este momento, los países como España, como el mío, deberían trabajar en estas infraestructuras hidráulicas de prevención —también adaptadas a lo que es el tema agrario— y, por supuesto, bajar los impuestos, el IVA de los alimentos, que la rebaja no se ha prorrogado en este momento en ese decreto trampa que ayer llevaron al Congreso de los Diputados. Creo que es fundamental la seguridad alimentaria y, para conseguirla, tenemos que trabajar en las infraestructuras hidráulicas, como la nueva Comisión y la nueva comisaria están haciendo en este momento en Europa.

     
       

     

      Marta Temido, em nome do Grupo S&D. – Senhor Presidente, Senhora Comissária, Caros Colegas, a desertificação e a degradação dos solos, tal como as alterações climáticas, são uma realidade que põe em causa os direitos humanos mais básicos, como o direito à alimentação ou o direito ao acesso à água limpa e segura. Atingem, em especial, as comunidades mais vulneráveis, as mulheres, as crianças, os povos indígenas, mas, potencialmente, vão atingir-nos a todos.

    E a COP 16, que decorreu em Riade no passado mês de dezembro, reforçou a urgência do combate a estes fenómenos, através da intensificação da colaboração internacional e de uma abordagem integrada. A União Europeia reafirmou o seu compromisso com a meta global de neutralidade da degradação da terra e o empenho em atingir este objetivo até 2030, através de incentivos aos Estados-Membros para que adotem políticas que favoreçam a restauração das terras e a implementação de práticas agrícolas sustentáveis.

    Por isso, a União Europeia tem de continuar a incentivar a adoção destas práticas agrícolas regenerativas, que respeitem os ecossistemas naturais e contribuam para a restauração de solos degradados, e deve bater-se pela implementação da Lei do Restauro da Natureza. Mas a inclusão da sociedade civil e do setor privado neste combate são essenciais, e isso exige iniciativas de apoio.

    Quero referir, aqui, uma iniciativa da sociedade civil do meu país, Portugal, que exemplifica bem esta luta que precisamos de levar a cabo com ela. E é a iniciativa Pró-Montado Alentejo, um projeto que visa promover a construção de uma barreira florestal ativa na região sul de Portugal, baseada no montado de sobreiro e azinheira, com o objetivo de mitigar os efeitos das alterações climáticas, combater a desertificação, proteger a diversidade e, enfim, combater o despovoamento.

     
       

     

      Julien Leonardelli, au nom du groupe PfE. – Monsieur le Président, la COP16 a été, sans aucun doute, la plus grande réunion d’États à ce jour sur le sujet de la désertification. Elle se tenait à Riyad, ce qui a permis aux participants de constater à quel point ce problème bouleverse des puissances régionales qui reposaient autrefois sur l’agriculture, comme l’Éthiopie ou l’Égypte. Ce véritable fléau est aujourd’hui à nos portes. On l’observe déjà en Grèce, en Italie, mais aussi dans ma région au sud de la France, en Occitanie, où l’eau courante des habitants est désormais rationnée en été, lors des canicules, où les agriculteurs ne peuvent pas toujours arroser leurs cultures et où les feux de forêt se font de plus en plus fréquents.

    Aujourd’hui, le temps n’est plus aux belles intentions et aux fausses promesses, mais au changement. Les Européens touchés par l’artificialisation des sols et la sécheresse méritent mieux que les ânonnements suffisants de ceux qui se tiennent dans des tours de verre et de béton. Pour répondre à ce défi, il faut privilégier les circuits courts, réduire le libre-échange débridé qui pollue notre air et nos océans et se tourner vers l’innovation et la recherche, à l’image des pays du Golfe. Ne restons pas spectateurs, soyons les acteurs de notre salut avant qu’il ne soit trop tard.

     
       

     

      Francesco Ventola, a nome del gruppo ECR. – Signor Presidente, onorevoli colleghi, dal rapporto COP16 la desertificazione e la siccità rappresentano non solo emergenze ambientali, ma anche minacce sociali ed economiche per intere regioni.

    I dati forniti sottolineano che oltre il 40 % delle terre globali è degradato e che la siccità provoca perdite economiche annuali che superano i 300 miliardi. In Italia, questo si traduce in una crisi che colpisce soprattutto il comparto agricolo.

    Si rende sempre più necessaria e indispensabile la realizzazione di infrastrutture che ottimizzino il sistema di raccolta, conservazione e distribuzione della risorsa acqua. È necessario investire in impianti di riuso delle acque reflue. Nessuna goccia deve essere dispersa: non ce lo possiamo permettere.

    Non possiamo più accettare false politiche ambientali ideologizzate, che bloccano sui territori la realizzazione di progetti innovativi e realmente sostenibili. Bisogna intraprendere tutte le strade che la scienza e la tecnologia ci offrono per fronteggiare il rischio desertificazione.

    Cari colleghi, non limitiamoci solo a parlare dei problemi: agiamo per risolverli e facciamolo con determinazione, per il bene dei nostri territori, dell’Europa e delle generazioni future.

     
       

     

      Martin Hojsík, za skupinu Renew. – Vážený pán predsedajúci, vážená pani komisárka, vážené kolegyne, vážení kolegovia, aj keď sa takpovediac symbolicky konferencia dohody OSN o dezertifikácii konala v Saudskej Arábii uprostred púšte, nie je to téma, ktorá sa týka len Arabského polostrova a Afriky. Je to téma, ktorá sa veľmi bytostne týka aj nás v Európe. Dezertifikácia je každodenným problémom na Cypre, v Španielsku, v Taliansku, ale aj uprostred Európy. U nás doma na Slovensku každým rokom vidíme väčší a väčší podiel pôdy, ktorú už farmári nedokážu obhospodarovať, ktorá sa nám stráca takpovediac priamo pred očami, pretože sa vysušuje. O tom je dezertifikácia. Sucho a nedostatok vody sa stali fenoménom našej doby a keď prídu, tak prídu ako záplavy. Klimatická kríza sa mení na klimatickú katastrofu. Ničíme biodiverzitu a meníme krajinu v púšť. V niektorých častiach Slovenska farmári prišli až o 40 % svojich výnosov kvôli dezertifikácii. Taký obrovský to je problém. Preto ako spravodajca Európskeho parlamentu pre zákon o pôde, naozaj vás chcem vyzvať, aby ste ho podporili. Dúfam, že sa nám spolu s Komisiou a Radou podarí dosiahnuť čoskoro v trialógu dohodu. Základom je mať kvalitné informácie. V Rijáde sa dohodla medzinárodná platforma. V Európe takú nemáme, zákon o pôde ju vie poskytnúť.

     
       

     

      Pär Holmgren, för Verts/ALE gruppen. – Herr talman! Kommissionär Roswall! Klimatförändringarna handlar verkligen inte bara om att det blir varmare på planeten, utan ett mycket större hot i stora delar av världen är förändringarna i nederbördsklimatet. Det blir mer nederbörd, kraftigare nederbörd på de platser där vi redan har mycket vatten. Men framför allt, i det här sammanhang som vi diskuterar nu, på många platser, inte minst där vi har en stor del av mänskligheten, där vi har en stor del av jordbruk och matproduktion, blir det nu sakta men säkert torrare.

    Det är ett enormt stort akut hot mot oss och vår matproduktion. Det här gäller inte bara andra delar av världen, det gäller här hemma i Europa också. Vi ser delar av framför allt Sydeuropa, hur skördar av till exempel majs och vete redan har sjunkit med storleksordningen 60 %.

    Vi vet också att det torrare klimatet, det torrare, lokala och regionala klimatet, medför en massa riskkonsekvenser. Till exempel de förskräckliga översvämningar som vi såg i Valencia senast förvärrades så mycket av att marken där först hade blivit så torr och hård att den inte kunde ta emot vatten.

    Som kommissionär Roswall konstaterade: På COP16, visst i vissa steg, i vissa sammanhang tog vi steg framåt, men som ofta i sådana här sammanhang var det lite blandade resultat. Det största problemet är att vi återigen misslyckades med att få ett bindande globalt ramverk när det gäller att bekämpa torka.

    Hade ansvariga politiker redan i slutet på 1900‑talet tagit hänsyn till den forskning som fanns då hade vi förhoppningsvis inte varit där vi är nu. Men nu är vi där vi är, och det innebär att vi, inte minst här i EU, måste höja ambitionerna, både när det gäller att minska utsläppen och arbeta ännu mer aktivt med klimatanpassning.

     
       

     

      Catarina Martins, em nome do Grupo The Left. – Senhor Presidente, nos próximos 25 anos, três em cada quatro pessoas será afetada pela seca a nível mundial. É uma catástrofe e está aqui. A Europa está a aquecer mais rápido do que o resto do mundo e a seca prolongada chegou décadas antes do que estava previsto.

    Por isso mesmo, e apesar do veto dos Estados Unidos e do Japão a um acordo para um regime global de resiliência à seca, a União Europeia não pode desistir desse objetivo e deve agir a todos os níveis.

    Venho de um país, Portugal, onde a agricultura superintensiva condena boa parte da população alentejana e algarvia, incluindo os pequenos agricultores, a uma vida sem água. O que produzem não alimenta essas populações nem deixa riqueza no país. Tudo é exportado, incluindo os lucros. Por lá, ficam só os solos degradados.

    Por isso, bem sei que esta não é a luta da ecologia contra a agricultura, é a das nossas vidas, incluindo a produção alimentar, contra a voragem das multinacionais do agronegócio. E por isso, Senhora Comissária, vai ser mesmo preciso coragem para enfrentar alguns dos mais poderosos interesses económicos.

     
       

     

      Zsuzsanna Borvendég, a ESN képviselőcsoport nevében. – Tisztelt Elnök Úr! Magyarország termőföldjei az emberi tevékenység miatt száradnak ki. A Kárpát-medence természetes vízháztartása elegendő vizet biztosítana, ha a tájnak megfelelő módon gazdálkodnánk.

    De ma mindent a profitéhség határoz meg, amely kizsákmányolja a környezetet. Ártereink helyén zöldhasút termő szántóföldek vannak. Hagyjuk, hogy a folyók átvágtassanak az országon, ahelyett, hogy átitatnák a talajt az éltető vízzel.

    Az uniós döntéshozatal a klímaválság kapcsán a levegő összetételére fókuszál, és erre hivatkozva betarthatatlan emissziós szabályokat alkot, de az ennek érdekében használt új technológiák a talaj és a talajvizek elszennyeződését fokozzák.

    Magyarországon az aszállyal párhuzamosan az akkumulátorgyárak vízszennyező hatásával is számolni kell, vagyis nálunk is a gazdasági lobbik írják felül a környezetvédelmet.

    A Föld egy komplex rendszer, amely komplex válaszokat igényel, nem lehet kiragadni egyes problémákat. Ha valós megoldásokat akarunk, akkor a lokalitás felé kell mozdulnunk, és uniós forrásokból is a helyi sajátosságoknak megfelelő természetközeli megoldásokat kell támogatnunk.

     
       

     

      Christine Schneider (PPE). – Herr Präsident, Frau Kommissarin, meine sehr geehrten Damen und Herren! Wüstenbildung ist eine globale Herausforderung, und Europa ist immer stärker betroffen. Unsere Ernährungssicherheit, die wir lange für selbstverständlich hielten, ist bedroht. Eine Lösung kann nur mit und nicht gegen unsere Landwirtinnen und Landwirte gefunden werden. Was passiert, wenn wir über ihre Köpfe hinweg entscheiden, das haben die letzten Jahre gezeigt. Bauernproteste sind zwischenzeitlich vor diesem Haus zum Alltag geworden. Daher mein dringender Appell: Beziehen Sie von Anfang an den Berufsstand mit ein, insbesondere bei der angekündigten Water Resilience Strategy.

    Drei Aspekte möchte ich hervorheben: Wir brauchen erstens ein intelligentes Wassermanagement. Nutzen wir die künstliche Intelligenz, um Wasserressourcen effizient zu verteilen. Setzen wir auf Wiederverwendung von Grauwasser und Abwasser, und bauen wir wassersparende Infrastruktur aus. So können wir Wasser nachhaltig zwischen den Regionen und Sektoren nutzen. Zweitens: dürreresistentes Saatgut. Es ist unverzichtbar, um Erträge selbst unter extremen Klimabedingungen zu sichern. Dazu brauchen wir neue Züchtungstechnologien, und die Blockade im Rat muss beendet werden. Drittens: Innovative Bewässerungslösungen, Tröpfchen- und Präzisionsbewässerung nutzen Sensorendaten, setzen Wasser ganz gezielt ein und vermeiden dadurch Verluste. Diese Technologien müssen wir stärker fördern, um unsere Landwirtschaft noch effizienter und nachhaltiger zu machen.

    Kurz zusammengefasst: Wenn wir Ernährungssicherheit wollen, brauchen wir neue Technologien und innovative Lösungen in enger Zusammenarbeit mit unseren internationalen Partnern, mit unseren Landwirten, aber auch mit uns Verbraucherinnen und Verbrauchern.

     
       

     

      Σάκης Αρναούτογλου (S&D). – Κύριε Πρόεδρε, η Γη μας, πηγή ζωής για αιώνες, αντιμετωπίζει τον κίνδυνο να μετατραπεί σε πηγή αφανισμού. Οφείλουμε να αποτρέψουμε τη μετατροπή εύφορων περιοχών σε ερημωμένα τοπία. Όταν το έδαφος καταστρέφεται, διακυβεύεται το μέλλον της ανθρωπότητας. Η ζωή δεν μπορεί να ευδοκιμήσει σε καμένη γη. Η Ευρωπαϊκή Ένωση καλείται να αναλάβει ηγετικό ρόλο, διακηρύσσοντας την ανάγκη για ορθολογική διαχείριση των φυσικών πόρων και τερματισμό επιτέλους της αδράνειας. Η συνέχιση της παρούσας πορείας θα οδηγήσει στη συγκομιδή των συνεπειών της αδιαφορίας μας και όχι των καρπών της γης. Προτείνω τη σύναψη ενός Συμφώνου για Ζωντανή Γη, μια συμφωνία που θα προβλέπει την αντιστάθμιση κάθε χαμένης έκτασης με την αναγέννηση διπλάσιας έκτασης μέσω βιώσιμων επενδύσεων. Μια τέτοια πρωτοβουλία θα μπορούσε να αποτελέσει ένα νέο παγκόσμιο πρότυπο για τη βιώσιμη διαχείριση των εδαφών. Δεν πρόκειται για μια ουτοπική ιδέα, αλλά για μια επιτακτική ανάγκη. Παρά τις προσπάθειες για την προστασία του πλανήτη, παρατηρούμε την εστίαση ορισμένων στην εξερεύνηση διαστημικών προορισμών, παραβλέποντας την ανάγκη για άμεση δράση στη Γη. Φαίνεται να προκρίνεται η κατάκτηση ενός απομακρυσμένου κόκκινου πλανήτη εις βάρος της διαφύλαξης του πράσινου πλανήτη μας. Επιπλέον, διαπιστώνεται η ενίσχυση ρητορικών που αμφισβητούν την κρισιμότητα της κατάστασης, υποβαθμίζοντας τις περιβαλλοντικές προκλήσεις σε πολιτικά παιχνίδια. Η φύση μάς απευθύνει επείγουσα έκκληση. Ας την αφουγκραστούμε, πριν η σιωπή της γίνει πιο εκκωφαντική από οποιαδήποτε φωνή. Ο χρόνος για δράση είναι τώρα. Και σε όσους αναζητούν καταφύγιο σε άλλους πλανήτες, ας τους υπενθυμίσουμε ότι εκεί οι συνθήκες είναι ήδη ερημικές και θα έρθει η ερημοποίηση και στον πλανήτη μας, αν αυτό επιζητούν.

     
       

     

      Mireia Borrás Pabón (PfE). – Señor presidente, señora comisaria, señorías, voy a ser muy clara: la CP16 ha sido otro espectáculo bochornoso de hipocresía, con líderes mundiales que vuelan en sus jets privados a Arabia Saudí; un país, por cierto, que incumple el 75 % de las restricciones medioambientales que ustedes desde aquí, desde Bruselas, imponen sin piedad a nuestros agricultores. Sí, aquellos mismos que evitan la desertificación del territorio. ¿Y qué resultados hemos obtenido? Ninguno, ningún compromiso vinculante.

    Nos enfrentamos a un gran problema, señora comisaria: casi el 70 % de las tierras agrícolas mediterráneas están en riesgo de desertificación y solo en España —en mi país— dos millones de hectáreas ya están clasificadas como desérticas. ¿Y qué hace la Comisión al respecto? Lo de siempre: culpabilizar al cambio climático. Pero ¿se han planteado, por un momento, que el principal problema fuera, por ejemplo, la falta de inversión en infraestructuras hídricas? En Europa se pierden millones de toneladas de agua de riego debido a infraestructuras hídricas que están tremendamente anticuadas.

    Miremos a Israel —un país que tiene recursos hídricos muy escasos y condiciones casi desérticas—, que ha revolucionado su agricultura con tecnología muy avanzada; mientras ellos aumentan su productividad un 30 %, aquí en Europa nuestros agricultores se ven obligados a abandonar sus tierras. Desde Vox ya seguimos en esta línea y propusimos un plan: un gran Plan Hidrológico Nacional para garantizar el agua y cohesionar el territorio. ¿Y qué es lo que votó toda la izquierda en bloque? Un no rotundo. ¿Y qué es lo que votó el Partido Popular? Pues se abstuvo, como siempre, cuando le gustan nuestras iniciativas, pero tienen complejo en admitirlo.

    Miremos ahora a Jaén: Marmolejo, Arjona, Lopera. ¿Les suenan, señores del PP? Son lugares de España donde el Partido Popular está expropiando tierras cultivadas con olivos para construir masivamente plantas fotovoltaicas. ¿Les preocupa de verdad la desertificación, señores del PP? 100 000 olivos a la basura, en nombre de la sostenibilidad. Empezamos a pensar que ustedes prefieren el aceite de Marruecos al aceite de Jaén, pero lo cierto es que no me extrañaría ver dentro de muy poco tanto al Partido Popular como a la izquierda manifestándose juntos en contra de sus propias políticas, esta vez no en apoyo de las nucleares, sino en su falsa solidaridad con los agricultores de Jaén, tan falsa como la sostenibilidad que defienden.

     
       

     

      Laurence Trochu (ECR). – Monsieur le Président, Madame la Commissaire, mes chers collègues, face aux enjeux climatiques, il est triste de voir que les solutions idéologiques prennent trop souvent le pas sur le bon sens. La question de la désertification n’y fait pas exception et les réponses apportées à ce problème, que personne ne nie d’ailleurs, sont souvent illusoires. À ce titre, l’opposition féroce et même, parfois, violente des écologistes français à des solutions de bon sens telles que les mégabassines, qui stockent le surplus d’eau de l’hiver pour le réutiliser l’été, est un exemple éloquent.

    Alors, plutôt que de voir en l’homme uniquement un prédateur-pollueur, l’homme doit être la solution, par l’innovation, le progrès technique et la recherche. La désertification ne peut être combattue par une écologie punitive et normative à outrance, ruineuse pour notre compétitivité, comme l’a d’ailleurs souligné le rapport Draghi.

    Nos agriculteurs, qui ont façonné nos paysages, sont las d’être désignés comme les principaux responsables et d’être écrasés de normes. Dernier artefact idéologique, le changement climatique est aussi utilisé comme prétexte pour justifier une immigration de masse venue du Sud dont plus personne ne veut. Alors, chers collègues, pour relever le défi du climat, sortons enfin de l’idéologie.

     
       

     

      Billy Kelleher (Renew). – Mr President, as I stand here, my home country of Ireland is preparing to be battered by one of the strongest storms in decades. And if you look at the weather forecasts across Europe, there’s rain in many areas. So it’s a concept that is very hard to understand when we sometimes speak about desertification.

    But, in reality, the scale of this problem – the desertification – should be everyone’s concern. It affects the land of homes to 1.5 billion people. The UN estimates that 135 million people have already been displaced due to desertification, and this could rise to 700 million by 2050. This land is also important agricultural land, and the UN estimates that 40 % of agricultural land has already been degraded.

    The consequences are far-reaching: humanitarian, migration, environmental problems, food and water security, political stability or political instability, for global security, for trade and supply chains there are significant challenges. And each of these consequences will have an impact also on Europe and the daily lives of our citizens.

    We cannot reverse the problems in the very short term, but we have to plan and we must make real collective efforts to halt its spread and to address its long-term implications. So while I welcome the commitments at the COP16 of the United Nations Convention to Combat Desertification, especially regarding the financial commitments from both the public and private sector, we do need to ensure that we make a common effort to bring forward the challenges regarding drought and the protocols with regard to tackling the same.

    If we are going to halt this runaway train, we need to have a common, coherent plan for tackling drought and that involves governments, businesses, local people, scientists and engineers.

     
       

     

      Kai Tegethoff (Verts/ALE). – Mr President, the summer of 2024 is the hottest on record in the EU and globally. Thirteen Member States, meaning almost 50 % of the Member States of the EU, are affected by desertification and almost 25 % of the territory is sensitive to desertification. Still, while the EU promotes the leadership role globally, we are not prepared ourselves.

    The desertification COP16 failed to agree on a global drought framework, and the Commission promised to present a water resilience strategy already a year ago. I hope this will come very soon.

    And Commissioner Roswall, in your introduction, in your first sentence you said that we need to focus on helping farmers, and in the second sentence it was ‘focus on economy’. I think what we really need in that water resilience strategy is water saving targets. We need to improve efficiency and reuse of water. We need to protect and restore our water supplies and the whole catchment area.

    And then at the same time, considering the wildfires and the flooding that we deal with here every single plenary session, we have to make sure that this water resilience strategy is accompanied and embedded into a real European climate adaptation law.

     
       

     

      João Oliveira (The Left). – Senhor Presidente, o problema da desertificação é um problema ambiental ou climático, mas é essencialmente um problema da relação do ser humano com a natureza, é um problema humano, social e económico.

    As conclusões da COP16 contêm muitos dos elementos relevantes para o debate sobre o combate à desertificação, mas revelam também as muitas dificuldades que é preciso ainda superar.

    Há muito por fazer para que haja verdadeiramente soluções, relativamente ao uso e à gestão eficientes da água e dos recursos hídricos, relativamente à ocupação e ordenamento equilibrado do território, relativamente à promoção de práticas produtivas sustentáveis, equilibradas, seja na agricultura, na pecuária, na silvicultura. Há muito por fazer no investimento público que é preciso nos territórios rurais, para travar o abandono da população e a consequente desertificação do território.

    Permitam-me trazer, aqui, um aspeto que é relevante em Portugal, que é o montado de sobreiros e azinheiras, que é característico do meu país. O montado não é apenas um conjunto de árvores que retêm carbono e resistem melhor aos incêndios. O montado é um sistema agrosilvopastoril que tem de ser encarado como tal em todas as suas dimensões, não apenas pelo valor ambiental, mas pelo enorme valor social que tem, porque cria emprego, fixa as populações, permite práticas produtivas sustentáveis e equilibradas, garante um adequado ordenamento do território na compatibilização da sua utilização para fins produtivos, mas também tem preocupações ambientais.

    Este é um exemplo do investimento que precisamos de fazer em áreas e em recursos que, sendo naturais de cada país, naturalmente permitem uma resposta mais eficaz ao combate à desertificação.

     
       

     

      Daniel Buda (PPE). – Domnule președinte, doamnă comisară, doamnelor și domnilor colegi, deșertificarea este o realitate care nu poate fi contestată, iar la COP 16 s-a subliniat acest lucru. Potrivit datelor oficiale, deșertificarea generează costuri globale de peste 300 de miliarde de euro și afectează mai mult de 1,5 miliarde de oameni, crescând presiunile migraționiste și alimentând războaiele pentru resurse.

    Uniunea pierde anual 74 de miliarde de euro din cauza degradării terenurilor, iar lipsa acțiunii va reduce randamentele culturilor cu cel puțin 10 % până în 2050, generând o penurie, atât pentru apă, cât și pentru alimente. România, țara mea, se confruntă din plin cu aceste fenomene. Avem nevoie urgent de acțiuni curajoase, care nu doar să prevină acest fenomen, ci chiar să-l inverseze pe termen lung.

    Pentru a ne proteja securitatea alimentară, trebuie să investim în tehnologii și soluții inovatoare, precum noile tehnici genomice în gestionarea durabilă a apei și dezvoltarea unor sisteme inteligente de irigații la prețuri accesibile pentru toți fermierii, și subliniez acest lucru: la prețuri accesibile pentru toți fermierii.

    În același timp, se impune utilizarea eficientă a apelor uzate, mai ales în jurul marilor centre urbane, și investiții serioase în ceea ce înseamnă desalinizarea apei marine, toate acestea trebuind să devină o prioritate strategică și o obligație față de cetățenii noștri.

    Investițiile din sectorul privat trebuie încurajate, iar Comisia trebuie să se asigure că statele membre utilizează eficient și rapid banii pentru împăduriri și perdele forestiere. Europa are la dispoziție soluții, însă fără investiții direcționate și finanțare adecvată, nu va putea face față acestor provocări.

    Stimați colegi, alegerea este a noastră: să acționăm acum sau generațiile viitoare vor suporta consecințele imobilismului nostru destructibil.

     
       

     

      Maria Grapini (S&D). – Domnule președinte, doamnă comisară, stimați colegi, sigur, dezbatem o problemă foarte importantă, păcat că sunt așa de puțini membri ai Parlamentului European în sală. Așa cum s-a declarat și aici, cum a fost și în declarația Convenției, se degradează anual terenul. S-a ajuns la 70 % din terenuri care au fost transformate din starea lor naturală.

    Secetele cauzează pagube și costuri și daune, peste 300 de miliarde pe an. Unde merg aceste daune și pagube? Evident, la fermieri și, până la urmă, la cetățeni. Doar în perioada 2015-2019, circa 100 de milioane de hectare de terenuri sănătoase și productive au fost degradate anual, amenințând evident, securitatea alimentară a globului, precum și disponibilitatea apei.

    Ce trebuie făcut, doamnă comisară? Ne-ați relatat ce a fost la Convenție și că nu s-a ajuns la compromisuri importante. Eu cred că Uniunea Europeană trebuie să fie preocupată mai ales de ce se întâmplă în Uniunea Europeană, sigur, și global. Eu cred că trebuie să îmbunătățim instrumentele politice naționale și europene pentru abordarea productivă de gestionare a secetei. Aici avem foarte mult de făcut. Este nevoie de alocarea de bugete pentru finanțarea restaurării terenurilor, creșterea rezistenței la secetă, prin cercetare și inovare.

    Comisia Europeană trebuie să aibă un plan de acțiuni la nivelul Uniunii Europene care să combată degradarea terenurilor în colaborare cu statele membre. Și mai trebuie făcut ceva, doamnă comisară: politicile Uniunii Europene, ale Comisiei, nu trebuie să se anuleze ca la algebră – plus și minus – sunt mii de hectare acum, cu parcuri fotovoltaice, terenuri care nu mai sunt recuperate zeci de ani.

    Trebuie să vedem cum corelăm politica energetică cu această politică de protejare a terenurilor și cred foarte mult că este nevoie să vă gândiți, în principal, la cum să nu creăm presiune asupra fermierilor din Uniunea Europeană, asupra cetățenilor din Uniunea Europeană, atât timp cât în restul globului, Statele Unite, Japonia și celelalte state, nu au votat la această Convenție.

     
       

     

      Mathilde Androuët (PfE). – Monsieur le Président, à l’issue de la COP16 consacrée à la désertification qui a eu lieu à Riyad, 12 milliards ont été sécurisés d’ici 2030 pour améliorer les terres, dont dix proviennent de la Banque islamique de développement. Dans un rassemblement international, les pétromonarchies sont donc venues au secours des déserts de sable, déserts où parfois on construit, en dépit de tout souci environnemental et économique, des pistes de ski.

    Voilà, une fois de plus, la démonstration qu’aux problèmes environnementaux, qui sont des problèmes localisés, on ne peut avoir de réponse globalisée. Les COP sont des rassemblements de déblocage ou de création de fonds financiers, aucunement des lieux de réflexion et d’apport de solutions environnementales. Aussi, sur le problème majeur de la désertification et de l’assèchement des sols, ayons une vision et des solutions locales. La gestion de l’eau est une question sensible et différente d’un pays à l’autre et, parfois, d’une région à l’autre dans un seul et même pays. L’an passé, dans le nord de la France, les cultures ont souffert de trop de pluies, soit l’inverse exact des Pyrénées orientales, en manque d’eau permanent.

    Si vous vous refusez au traitement local pour n’opérer qu’à l’échelle européenne, prenons des problèmes communs. En Bulgarie comme en Guadeloupe, 60 % de l’eau est perdue tant les infrastructures sont vétustes et fuyardes. De même, encouragez le reboisement, le replantage des haies pour favoriser la captation de l’eau par les sols. Bref, appuyez-vous sur ceux qui connaissent le mieux leur environnement, à savoir les paysans, plutôt que sur les financiers des pétromonarchies pour régler nos problèmes d’eau et de désertification en Europe. À problème local, solution nationale.

     
       

     

      Marie Toussaint (Verts/ALE). – Monsieur le Président, la désertification, c’est l’autre nom de l’injustice climatique et de la vulnérabilité. C’est d’ailleurs peut-être parce qu’elle a d’abord touché les pays les plus pauvres que les pays les plus riches n’y ont, pendant si longtemps, prêté que si peu d’attention. La désertification est aujourd’hui sur nous. La Corse et les parties les plus pauvres de la Méditerranée, Perpignan et ses quartiers parmi les plus précaires de France, ou encore la dévastée Mayotte, n’ont plus d’eau. En Guadeloupe, l’érosion côtière frappe, puisant dans l’assèchement des terres. Quand dans le Massif central, ce sont évidemment les petits paysans qui souffrent le plus et qui n’ont pas les moyens d’acheter du foin pour leurs élevages lorsque celui-ci vient à manquer.

    Au fond, la désertification continue dans l’indifférence, parce qu’elle frappe d’abord et de manière évidente les plus vulnérables. Mais ne soyons pas naïfs: nous réaliserons bientôt que la désertification est notre affaire à tous. Espérons qu’alors il ne sera pas trop tard. En Afrique, c’est déjà 16 % du PIB qui s’est évaporé du fait de la désertification.

    Madame la Commissaire, nous ne sommes pas impuissants, ici, sur le territoire européen, pour un enjeu qui est bien un enjeu planétaire. La désertification est liée au dérèglement climatique et aux énergies fossiles. Alors sortons-en, et plus vite qu’aujourd’hui. Elle est aussi liée à l’agriculture intensive et à la déforestation que nous pouvons, que nous devons combattre. Alors agissons! Il n’y a plus de temps à perdre.

     
       

     

      Valentina Palmisano (The Left). – Signor Presidente, onorevoli colleghi, non è necessario guardare al Sahara per comprendere la desertificazione: i deserti si trovano ormai dietro casa. Sempre più spesso, immagini surreali, e allo stesso tempo drammatiche, mostrano paesaggi trasformati, fiumi ridotti a sentieri e laghi completamente prosciugati.

    Il 40 % del suolo del Sud Italia è già a rischio, come tanti paesi del Mediterraneo. In questo modo, stiamo trasformando paesaggi millenari.

    E questo non è soltanto il risultato del cambiamento climatico, ma anche di pratiche agricole non sostenibili, che hanno impoverito il nostro suolo. Ecco, il nostro approccio deve cambiare, privilegiando la qualità delle produzioni e la rigenerazione del suolo.

    Il degrado non è inevitabile, per fortuna: possiamo invertire la rotta. Servono però incentivi per modelli agricoli basati sulla qualità e sulla rigenerazione del suolo. La politica deve smettere di finanziare pratiche obsolete e supportare invece l’innovazione.

    Colleghi, la desertificazione, infatti, non è soltanto una sfida tecnica, ma è anche una questione di giustizia verso i nostri territori e soprattutto verso le generazioni future.

    Il mio monito è che non sia la COP17 a salvare il suolo europeo, ma il nostro impegno concreto, oggi.

     
       

     

      Salvatore De Meo (PPE). – Signor Presidente, signora Commissaria, onorevoli colleghi, la desertificazione è una delle sfide più urgenti del nostro tempo, aggravata dal cambiamento climatico e dalle attività dell’uomo.

    Non è solo una crisi ambientale, ma un problema sociale ed economico che minaccia la biodiversità, la sicurezza alimentare e la stabilità delle nostre comunità, alimentando tensioni e migrazioni forzate.

    Pensate che, ogni anno, 12 milioni di ettari vengono degradati, mettendo a rischio la sopravvivenza di oltre un miliardo di persone. Questo dato ci allarma e ci ricorda che la desertificazione, insieme alla crescente scarsità dell’acqua, richiede risposte immediate, coordinate e ambiziose.

    La COP16 è stata un’occasione per riflettere sulle nostre responsabilità, perché l’Unione europea manca di un’azione comune adeguata e le risorse dedicate sono ancora troppo limitate rispetto alla portata degli interventi.

    Dobbiamo impegnarci e sostenere lo sviluppo di politiche sostenibili, promuovendo pratiche agricole rigenerative e resilienti, un uso responsabile delle risorse idriche e l’innovazione tecnologica per ripristinare gli ambienti degradati.

    La cooperazione internazionale, inoltre, è importante perché nessun paese può affrontare da solo questa battaglia. La desertificazione non conosce confini e le sue conseguenze si ripercuotono su scala globale. Solo lavorando insieme possiamo affrontare la complessità di questa sfida. Ciò significa condividere conoscenze, tecnologie e risorse, oltre a costruire – come si sta facendo – partenariati solidi tra governi, organizzazioni internazionali, società civile e settore privato.

    Combattere la desertificazione significa investire nel futuro, nella nostra diversità, nella sicurezza alimentare e nella stabilità delle generazioni future.

     
       

     

      Thomas Bajada (S&D). – Mr President, desertification is not a story from far, far away. Its serious implications have long been affecting the Mediterranean region due to its unique ecosystems, economic dependencies and limited natural resources.

    In southern Spain, over-irrigation has led to soil erosion. In Crete, aquifers have been overexploited, leading to salinisation. In the neighbouring Sahel region, desertification has displaced millions of people, increasing migratory pressures towards Europe. And in Malta, increased pressure on desalinisation plants raised energy consumption and costs, which are passed on to households and businesses.

    Today this is not a story only for southern Europeans. It is also a story shared with other Europeans from temperate and humid climates like Bulgaria. In fact, last year 45 % of the EU’s territory faced drought, threatening food production and water security.

    Desertification is about humanity, our dependence on water for survival, and our need for water security and food security. Therefore, our response must be people-centred. The fight against desertification demands global cooperation, but it also starts at home in this very House. We need to dramatically increase our political commitment to water – we need to preserve our lands, help our nature to recover and conserve our water. And, dear Commissioner, we need to act now, with an ambitious European water resilience strategy before it is too late.

    As rapporteur of the Parliament’s initiative, I call for decisive action to protect our people and resources and build a sustainable future of a liveable world for future generations to come.

     
       

     

      France Jamet (PfE). – Monsieur le Président, la désertification est une menace importante, mais il en est une dont on ne parle pas assez, c’est la désertification de nos fonds marins. Déplorer l’acidification de nos océans, le réchauffement des eaux ou la hausse du niveau de la mer ne suffit pas. Il faut aussi dénoncer les causes de ce désastre. En France, par exemple, dans le Morbihan, on les trouve dans la construction stérilisante de parcs éoliens offshores ou dans les ravages de bateaux-usines sans-frontiéristes. Deux activités nocives, deux activités pourtant encouragées par l’Union européenne, qui témoignent de l’hypocrisie générale, voire de l’imposture pseudo-écologiste sur la préservation et la pérennité de nos écosystèmes.

    Depuis quinze ans, on constate la dégradation alarmante de nos océans, qui menace nos richesses maritimes, les métiers qui en dépendent, au premier rang desquels nos pêcheurs, et nos ressources alimentaires. Cet équilibre si fragile, aggravé par la pollution terrestre qui se déverse dans nos mers, a aussi un impact sur nos climats et sur la désertification terrestre. La pluie salvatrice qu’attendent nos agriculteurs et les populations touchées par la sécheresse, cette pluie salvatrice ne tombe pas du ciel, elle vient de nos océans.

    Alors tous ces vœux pieux et autres déclarations d’intention ne résoudront rien si nous ne remettons pas en cause l’écosystème mondialiste que vous avez mis en place, basé sur un libre-échangisme dérégulé au détriment d’un localisme raisonné et national.

     
       

     

      Vicent Marzà Ibáñez (Verts/ALE). – Señor presidente, en los últimos diez años, la superficie desertificada en la península ibérica se ha multiplicado por veintitrés. Es especialmente preocupante en el sur de Alicante, en la Vega Baja, un territorio de transición, precisamente donde la presión urbanística es salvaje, donde la presión del sobreturismo es salvaje, y donde ahora ya no ocurre de forma aislada que se corte el agua, sino que ya es de forma recurrente. Y no solo se corta en verano, también en otros periodos del año. Ni pasa solo con el agua destinada a la gente y, por lo tanto, con el agua de boca, sino también con la que usan los agricultores.

    En el mismo territorio también ya hay una lucha que se va viviendo en toda Europa, que es por la privatización del agua. Tenemos cada vez menos agua y cada vez está gestionada por menos manos y mirando siempre hacia el negocio. Por eso, hacen falta de una vez por todas políticas valientes que custodien el territorio, que nos adapten al cambio climático y que protejan a la ciudadanía, por ejemplo, ante situaciones como la dana que hemos vivido en Valencia. Y hace falta que el agua sea gestionada de forma pública para que sea un derecho garantizado para el conjunto de la ciudadanía.

    (El orador acepta responder a una pregunta formulada con arreglo al procedimiento de la «tarjeta azul»)

     
       

     

      João Oliveira (The Left), Pergunta segundo o procedimento «cartão azul». – Senhor Deputado, o Governo de Portugal avançou recentemente com uma lei chamada Lei dos Solos, que tem como objetivo permitir a construção em solos onde até hoje essa construção não era permitida. Esta decisão, naturalmente, favorece a especulação imobiliária, mas cria também problemas de desordenamento do território.

    O senhor deputado vem da região de Valência — onde ainda recentemente houve uma tragédia, na sequência de umas cheias —, por isso, queria colocar-lhe uma questão precisamente a partir da sua experiência.

    Considerando a experiência na região de Valência, decisões como esta do Governo português, de desordenamento do território e de favorecimento da especulação imobiliária, permitem a solução de algum problema, por exemplo, o problema da habitação — que é o pretexto que o Governo português utiliza —, ou o combate à desertificação dos territórios? Ou, pelo contrário, opções destas de desordenamento do território agravam ainda mais as consequências de catástrofes naturais, como aquelas que atingiram a região de Valência?

     
       

     

      Vicent Marzà Ibáñez (Verts/ALE), respuesta de «tarjeta azul». – Sí, señor diputado Oliveira, la presión urbanística y la urbanización salvaje de hoy son las víctimas del mañana. Lo hemos visto en nuestra tierra con la dana: se ha construido donde no se podía construir, porque se ha visto que el territorio solo era un espacio de especulación y no para que la gente tuviera garantizado su espacio vital y se protegieran sus vidas.

    La gente ha muerto por estar, entre otras cosas, urbanizando territorios que no se pueden urbanizar. Ha habido una dana que ha llegado con esa cantidad de agua brutal porque estaba absolutamente todo cimentado, porque la tierra no ha podido acoger toda el agua también. Por eso es tan importante que se combatan esas iniciativas como la del Gobierno portugués que usted dice, porque urbanizar, insisto, de forma salvaje es crear víctimas en el futuro.

     
       

     

      Sebastian Everding (The Left). – Herr Präsident, liebe Kolleginnen und Kollegen! „Wälder gehen den Völkern voran, die Wüsten folgen ihnen“. Das sagte schon im 17. Jahrhundert der französische Schriftsteller Chateaubriand. Der Klimawandel und der massive Einsatz von Düngemitteln verstärken die Bodenerosion und auch das Artensterben. Grundwasserentnahmen für Bergbautätigkeiten, die industrielle Massentierhaltung und die Bewässerung in der Landwirtschaft entziehen Wäldern das Grundwasser, das dringend für die Regeneration in Dürrezeiten benötigt wird. Sie tragen zur Bodenversandung bei, schädigen das Ökosystem und trocknen CO2-Senken wie Moore aus. Hier muss dringend durch mehr Schutzzonen und mehr Entnahmeeinschränkungen gehandelt werden.

    Ein weiteres Mittel gegen Wüstenbildung könnte ein stärkerer Fokus auf die Agroforstwirtschaft sein. Dürren bedrohen bereits jetzt die Lebensgrundlage von rund 1,8 Milliarden Menschen weltweit und bringen gefährdete Gemeinschaften immer weiter an den Rand des Abgrundes. Darüber hinaus kosten sie 300 Milliarden US‑Dollar pro Jahr und bedrohen wichtige Wirtschaftssektoren wie die Landwirtschaft, Energie und Wasser. Liebe Frau Kommissarin, liebe Kolleginnen und Kollegen, wie bei allen anderen Aspekten des Klimawandels gilt auch hier: Es ist weitaus günstiger, jetzt zu handeln, als später zu versuchen, die Folgen zu kompensieren.

    (Der Redner ist damit einverstanden, auf eine Frage nach dem Verfahren der „blauen Karte“ zu antworten.)

     
       



     

      Gabriella Gerzsenyi (PPE). – Tisztelt Elnök Úr! A teve helyes állat, de nem szeretnénk közlekedési eszközként használni. Az éghajlatváltozás miatt az elsivatagosodás Magyarországon is egyre nagyobb probléma. Duna-Tisza közi homokhátság hazánk területének mintegy 10%-a, most már az ENSZ szerint hivatalosan is félsivatag.

    Ez a kormányzati tétlenségnek a szimbóluma. Csökkennek a terméshozamok, megnehezül a megélhetés, homokviharok előfordulnak, tavak száradnak ki és élőhelyek szűnnek meg. S nem csak környezeti, hanem társadalmi és gazdasági válság is, hiszen veszélyben az élelmiszer-ellátás és elnéptelenedik a vidék.

    Már két évtizede tudományos tanulmány és program készült a problémára. Az akkori kormány elfogadta, a Fidesz-kormány azonban tudatosan figyelmen kívül hagyja a szakértők figyelmeztetéseit, elhanyagolja a vízgazdálkodást, a talajvédelmet, ellenben százmilliárdokat költ presztízsberuházásokra, például stadionokra.

    A megoldás kulcsa az uniós, nemzeti és a helyi összefogás. Úgy véljük, hogy európai szinten átfogó stratégiára van szükség a fenntartható földhasználat és a vízvisszatartó technológiák támogatására.

    A Tisza Magyarország legnépszerűbb pártja. Kormányra kerülésünk után vissza fogjuk állítani az önálló környezetvédelmi minisztériumot. Kiemelten foglalkozni fogunk a talajvédelemmel, vízgazdálkodással, európai forrásokat irányítunk az érintett közösségekhez, és támogatni fogjuk a gazdákat ebben a küzdelemben is.

     
       

     

      César Luena (S&D). – Señor presidente, señorías, es un debate en un contexto bastante difícil, porque tenemos al nuevo inquilino de la Casa Blanca y su negacionismo, y un Grupo PPE retardista, ya lo siento. El discurso de ayer del señor Tusk nos lleva por esos senderos peligrosos.

    Presento dos ideas que son como dos evidencias. El suelo es un recurso no renovable, es importante no olvidarlo. ¿Saben cuánto han aumentado las sequías en los últimos 25 años? Un 30 %. Y, en este contexto, señora comisaria, ¿qué puede hacer la Unión? Le digo que defender las políticas verdes —al paso que vamos— va a ser algo casi contracultural. Pues mire, en primer lugar, una evaluación de riesgo de desertificación y degradación de las tierras, como sugirió el Tribunal de Cuentas Europeo en el año 2018. No sabemos nada de ese informe. La Ley de vigilancia del suelo, por favor, se lo pido a sus colegas del Grupo PPE, porque la están rebajando y rebajando, como todas las normativas medioambientales. Podemos declararnos como región en riesgo de desertificación en el marco de la Convención de las Naciones Unidas. Para eso no tenemos que esperar a ninguna cumbre internacional, eso podemos hacerlo ya nosotros. Y, sobre todo, presente una estrategia específica de desertificación, como le ha dicho este Parlamento.

    Fíjese: hasta cuatro grandes medidas podemos hacer nosotros solos —la Unión Europea— y dar ejemplo en el mundo. Pero claro, hay demasiado retardismo en la derecha. No caiga en eso, señora comisaria, hay muchos Grupos que la vamos a apoyar.

    (El orador acepta responder a una pregunta formulada con arreglo al procedimiento de la «tarjeta azul»)

     
       


     

      César Luena (S&D), respuesta de «tarjeta azul». – Estaba mirando, señor presidente, por si era alguien de la extrema derecha, porque no hubiera aceptado nunca nada, ni tarjeta azul ni verde.

    Mire, todo lo relacionado con los fondos europeos, a pesar de su Grupo y de su política en España, lo estamos sacando adelante bien. Y no quiero recordar aquí lo que han intentado ustedes hacer con la vicepresidenta primera, Teresa Ribera. Es decir, que a pesar de que ustedes aquí estén en contra de todo y siempre estén poniendo obstáculos y problemas, nosotros estamos aplicando muy bien los fondos NextGenerationEU en España y lo seguiremos haciendo. Solo le pido una cosa: está bien que me haga esa pregunta, pero después, en España, ayuden, que siempre están en contra de todo.

     
       

     

      Jutta Paulus (Verts/ALE). – Herr Präsident, Frau Kommissarin, liebe Kolleginnen und Kollegen! Als ich ein Kind war, war Wüste die Sahara oder die Gobi. Ferne, beeindruckende Orte, beschrieben in den Romanen von Karl May oder den Schilderungen von Sven Hedin. Und heute, nur wenige Jahrzehnte später, sehen wir Wüstenbildung in Spanien, in Portugal, in Italien, in Griechenland, in Ungarn, in Bulgarien. Wer sich da wundert, hat die Wissenschaft ignoriert oder den Einflüsterern der fossilen Industrie geglaubt. Die haben Milliarden investiert, um Zweifel zu säen – Zweifel an den Erkenntnissen, die Exxon selbst schon in den 70ern ermittelt hatte, um sie dann in den Giftschrank zu legen und öffentlich die Wissenschaft zu diskreditieren.

    Die Leugner sitzen auch in diesem Haus bei den Rechten, den noch Rechteren und den noch noch Rechteren, und bei der Welt‑Wüsten‑Konferenz haben wir leider auch keine großen Fortschritte gemacht, denn auch hier sitzen ja die Petrostaaten mit am Tisch. Deshalb: Europa muss handeln. Wir brauchen ein Klimaanpassungsgesetz, das naturbasierte Lösungen in den Mittelpunkt stellt, und eine glaubwürdige Unterstützung für die Länder, die am stärksten betroffen sind.

    (Die Rednerin ist damit einverstanden, auf eine Frage nach dem Verfahren der „blauen Karte“ zu antworten.)

     
       


     

      Jutta Paulus (Verts/ALE), Antwort auf eine Frage nach dem Verfahren der „blauen Karte“. – Vielen Dank, Frau Kollegin, für die Frage. Es ist mir ein Rätsel, wo Sie Ihre Anschuldigungen und Informationen hernehmen, denn wir sind ja durchaus die Partei, die für eine bäuerliche, kleinbäuerliche, familienzentrierte Landwirtschaft eintritt, die für eine nachhaltige Landwirtschaft eintritt, die im Einklang mit dem steht, was uns die Wissenschaft empfiehlt.

    Da brauchen Sie bloß mal in die Berichte unserer eigenen Agentur zu schauen – die Europäische Umweltagentur ist eine Agentur dieser Europäischen Union. Da sitzen hochmögende Wissenschaftlerinnen und Wissenschaftler, die sich seit Jahren und Jahrzehnten mit diesen Fragen beschäftigen. Und das, was wir in unseren Programmen, in unseren Vorschlägen aufgreifen, entspricht dem, was diese Wissenschaft uns vorschlägt, denn wir stehen auf dem Boden der Wissenschaft und nicht auf dem Boden der Lobbyinteressen, die hier leider ihre Papiere verbreiten.

     
       


     

      Borja Giménez Larraz (PPE). – Señor presidente, el agua es vida y el agua es desarrollo. Hoy vemos como la desertificación avanza. La falta de agua se ha convertido en una amenaza, especialmente para los países y las regiones del sur de Europa. Aunque algunos somos más vulnerables, este desafío nos afecta a todos. Hablamos del acceso a un bien básico. Hablamos de un recurso fundamental para la agricultura y para la ganadería, para la industria, para crear empleo y fijar la población.

    La Unión Europea debe implicarse de lleno en el impulso de un pacto europeo del agua que establezca medidas integrales para garantizar una gestión sostenible y eficiente de los recursos hídricos. Y ese pacto hay que dotarlo de fondos: necesitamos fondos para construir y modernizar infraestructuras hidráulicas, como embalses y presas que permitan regular cauces y gestionar periodos de sequía de forma más eficaz. Necesitamos fondos para mejorar y modernizar los sistemas de regadío. Todo ello acompañado de políticas de gestión eficiente del agua. Y hay que actuar con urgencia.

    En España, en mi región, Aragón, que tiene zonas profundamente áridas y desérticas, el Parlamento autonómico aprobó por unanimidad en 1992 el llamado Pacto del Agua, un acuerdo que reivindica las obras hidráulicas necesarias para garantizar las necesidades presentes y futuras de la comunidad. Pues bien, en estos treinta años hemos avanzado muy poco: tenemos más de treinta obras pendientes. Sabemos desde hace décadas qué es lo que queremos, lo que necesitamos, pero la falta de voluntad y fondos lo ha dejado en el olvido. Ante la inacción del Gobierno de España, la Unión Europea debe adoptar un papel activo. Debe contribuir a financiar estas obras. Hoy ya no es una opción: es una obligación.

     
       

     

      Camilla Laureti (S&D). – Signor Presidente, onorevoli colleghi, la desertificazione va affrontata a livello globale, perché mette a rischio biodiversità, risorse idriche e sicurezza alimentare e fa tremare la giustizia sociale.

    Spaventa pensare che, anche a causa degli effetti della desertificazione e della siccità, entro il 2050 oltre 200 milioni di persone potrebbero essere costrette a migrare.

    Lo vediamo anche in Europa: il Sud soffre sempre di più per siccità e carenza di acqua. In Italia abbiamo intere regioni che restano per lunghi periodi senz’acqua, anche a causa di una scorretta gestione della risorsa idrica. L’acqua – il nostro bene più prezioso – non è una merce, ma è un diritto, e dobbiamo incentivarne conservazione e riuso e lavorare sulle reti idriche.

    Dobbiamo proteggere e ripristinare i nostri suoli, favorire con finanziamenti ad hoc e risorse il passaggio da metodi di coltivazione intensivi a pratiche agricole sostenibili. Se perdiamo i nostri suoli, perdiamo il pianeta.

    La desertificazione l’abbiamo vista arrivare e porta anche, e soprattutto, la nostra impronta: per questo, dobbiamo smettere di far finta che non esista e dobbiamo agire sin da ora.

     
       

     

      Marco Falcone (PPE). – Signor Presidente, signora Commissaria, onorevoli colleghi, in un momento in cui larga parte del continente fronteggia l’inverno, potrebbe apparire fuori contesto parlare di desertificazione e carenza idrica. Eppure, questo dovrebbe essere l’atteggiamento che qui in Europa dovremmo tutti avere: occuparci per tempo di questa enorme sfida, di questa enorme emergenza, prima che sia troppo tardi.

    E ve lo dice chi arriva qua a Strasburgo da una delle due più importanti isole del Mediterraneo, la Sicilia, e rappresenta due delle più importanti isole – assieme alla Sicilia, anche la Sardegna – entrambe fortemente a rischio. Si immagina che più del 50 % del territorio delle due regioni, addirittura entro i prossimi trent’anni, potrebbe essere a rischio desertificazione.

    Certo, il cambiamento climatico è un fattore decisivo. Purtroppo, però, la lotta alla desertificazione non può essere affidata solo alle misure collegate in qualche modo al Green Deal. Anzi, questo grande contenitore potrebbe diventare un luogo in cui tutto si perde, e già la Corte dei conti europea, nel 2018, aveva invitato l’Unione europea ad avere una visione completa e a porre in essere dei programmi di pianificazione.

    Ecco perché noi del Partito Popolare Europeo siamo per la difesa del territorio, certamente, e riteniamo che le isole debbano essere guardate con grande attenzione. Come? Tramite un serio programma di investimenti e, se vogliamo, di infrastrutture, non solo di transizione energetica.

    L’Europa deve avere il coraggio di varare un grande piano di stanziamenti strutturali per la lotta all’avanzare del deserto.

    (L’oratore accetta di rispondere a una domanda “cartellino blu”)

     
       


     

      Marco Falcone (PPE), risposta a una domanda “cartellino blu”. – Noi del Partito Popolare Europeo guardiamo a un approccio molto pragmatico. Certamente, la transizione ecologica diventa per noi il faro, ma al contempo riteniamo che un serio programma di investimenti debba essere calibrato alle esigenze del territorio. Non dobbiamo eccedere in un senso, ma nemmeno in un altro.

    Certamente, gli interventi in agricoltura, gli interventi tecnologici e, se vogliamo, anche un serio piano di investimenti, soprattutto in condutture idriche di adduzione e, se vogliamo, di approvvigionamento, possono rappresentare certamente una soluzione.

    Lo dico per la Sicilia – io provengo dalla Sicilia – dove l’acqua non manca, ma mancano le infrastrutture. Per cui, grazie per il suo input.

     
       

     

      Leire Pajín (S&D). – Señor presidente, señorías, se ha dicho aquí reiteradamente, nos enfrentamos a una crisis aparentemente silenciosa, pero profundamente devastadora: la desertificación, la pérdida de suelos fértiles y de recursos hídricos. De nuevo, es una crisis global que nos afecta a todos, también en Europa, especialmente en el Mediterráneo, en países como España, en regiones como Alicante.

    Hasta el 40 % de las tierras del mundo —casi la mitad— están degradadas. Esto supone una amenaza a la biodiversidad, pero también a la seguridad alimentaria. Las cifras lo dejan bien claro: el 90 % de la población mundial pasa hambre; es decir, más de 700 millones de personas, por no hablar de los cientos de miles de desplazados y de refugiados por la desertificación y por el cambio climático.

    El derecho a la alimentación es fundamental. Señorías, no podemos estar hablando aquí de las sequías y de la desertificación, pero luego intentar retrasar y retardar las normas que protegen contra la degradación de los suelos o que protegen la biodiversidad. No podemos hablar aquí de las cifras, pero después querer ser más laxos con las leyes que luchan contra eso.

    Por eso, señorías, como dijo el Tribunal de Cuentas, como dijo Naciones Unidas y como ha dicho el Consejo, necesitamos un plan ambicioso, transversal, que se coordine con otras Convenciones de las Naciones Unidas, con presupuesto y con objetivos, sin más demora.

     
       

     

      Manuela Ripa (PPE). – Herr Präsident! Die Wüstenbildung ist eines der drängendsten Probleme unserer Zeit – nicht nur etwa in Afrika oder in Asien, auch in Europa. 13 EU‑Länder in Süd‑, Mittel‑ und Osteuropa sind nach eigenen Angaben bereits betroffen. Auch in anderen Teilen Europas schreitet die Austrocknung von Böden voran. Zukünftig könnten auch hier Wüsten entstehen. Dass es dringenden Handlungsbedarf gibt, dieses Bewusstsein war nicht ausreichend vorhanden bei der COP16 in Riad. Auch in der EU wird definitiv nicht genügend getan. Probleme sind voranschreitende Bodenversiegelung, Entwaldung, zu intensive Landnutzung, falsche Bewirtschaftung. Der Klimawandel mit Dürren und Starkregenereignissen beschleunigt zudem noch den Verlust fruchtbarer Böden.

    Daher ist es von entscheidender Bedeutung, dass wir in Europa neben einer effektiven Wasserstrategie das EU‑Bodengesetz verabschieden – als erster wichtiger Schritt hin zu mehr Bodenschutz und gegen Wüstenbildung. Bei der Wüstenbildung ist es wie beim Klimawandel. Es ist viel kostengünstiger und einfacher, jetzt Gegenmaßnahmen zu ergreifen, als die Dinge umzukehren, wenn der Schaden schon eingetreten ist. Denn dann ist es zu spät.

     
       

     

      Jean-Marc Germain (S&D). – Monsieur le Président, mes chers collègues, Bakou, Cali, Riyad, les différentes COP se suivent et se ressemblent. Elles sont toujours utiles par leur existence même, mais jamais à la hauteur: 40 % des sols seraient dégradés dans le monde et 75 % de la population mondiale en sera affectée d’ici à 2050, 75 %. On le sait, les plus vulnérables en sont les premières victimes.

    Appelons un chat un chat: cette COP fut une déception. Et si l’Europe a fait preuve de volontarisme sur la promotion de la résilience à la sécheresse, son rôle a été plus ambigu: en s’opposant à un protocole juridiquement contraignant sur la sécheresse, en portant insuffisamment les pratiques agricoles durables et par une contribution financière insuffisante. Le Partenariat mondial de résilience à la sécheresse et ses 12 milliards de promesses a le mérite d’exister. Mais c’est une goutte d’eau, si je puis dire, par rapport aux 2 500 milliards nécessaires pour restaurer le milliard d’hectares de terres dégradées.

    Alors que Donald Trump vient de sortir de l’accord sur le climat, faisons preuve de leadership. Allons en Mongolie pour la COP17 avec des propositions et des aides concrètes, faute de quoi la planète et les générations futures ne nous le pardonneront pas.

     
       

     

      Dan-Ştefan Motreanu (PPE). – Doamnă comisară, domnule președinte, stimați colegi, deșertificarea afectează deja 13 state membre, iar seceta cauzează pierderi de 9 miliarde de euro anual. Doar în România, 400 de mii de hectare sunt afectate de deșertificare. Adoptarea Regulamentului privind restaurarea naturii impune statelor membre să refacă 20 % din terenurile degradate până în 2030.

    Din păcate, regulamentul nu a fost însoțit de alocări bugetare suplimentare. Drept urmare, solicit Comisiei Europene ca în următorul exercițiu financiar să abordeze această insuficiență și să pună fonduri concrete la dispoziția țărilor din Uniune.

    Totodată, pentru menținerea securității alimentare, este esențial să sporim investițiile în dezvoltarea sistemelor de irigații inteligente, utilizarea apelor urbane reziduale tratate, captarea apei pluviale și construirea de rezervoare.

    În plus, rezultatele cercetării privind desalinizarea apei marine din programul Orizont Europa trebuie să fie accesibile statelor membre pentru implementarea acestor tehnologii moderne la costuri reduse.

     
       

     

      Stefano Bonaccini (S&D). – Signor Presidente, onorevoli colleghi, siccità, incendi e pratiche produttive che minano la fertilità dei suoli stanno innalzando il rischio di desertificazione anche qui in Europa, dove 13 paesi, tra cui il mio e altri sei nel bacino del Mediterraneo in particolare, sono colpiti da questo fenomeno.

    A rimetterci sono produzione e sicurezza alimentare, tessuto sociale ed economico delle aree colpite, e i nostri agricoltori, prime vittime dei cambiamenti climatici che qualcuno, addirittura ancora oggi, nega.

    L’Unione europea deve essere protagonista in questa sfida a livello globale, diffondendo nei paesi più a rischio buone pratiche – ad esempio, irrigazione di precisione o depurazione e riuso agricolo delle acque reflue – e con un piano europeo per le acque, e per l’acqua, che con più risorse per le politiche di sviluppo regionale e rurale – confido per delega nel Commissario Fitto – sostenga e semplifichi investimenti per una maggiore capacità di accumulo – dighe invasi, bacini e reti di distribuzione più efficienti – e autorizzi nuove colture che necessitano di meno acqua.

    Il prossimo bilancio pluriennale, allora, deve diventare l’occasione per migliorare alcune politiche dell’Unione e sostenere con i fatti, e non le parole, cittadini e imprese nel contrasto al cambiamento climatico.

     
       

     

      Ştefan Muşoiu (S&D). – Domnule președinte, doamnă comisară, dragi colegi, la nivelul Uniunii, deșertificarea afectează 8 % din teritoriu, așa cum au precizat și colegii mei antevorbitori. Zonele cele mai prejudiciate însă sunt cele din Europa Centrală, de Sud și de Est. Și țara mea, România, suferă din cauza acestui proces nesănătos al naturii. 40 % din suprafața sa agricolă este în pericol să se transforme în dune de nisip.

    De aceea, nu trebuie să permitem ca acest neajuns major să devină o amenințare la adresa siguranței alimentare a generațiilor viitoare de europeni. Acest fenomen grav trebuie decelerat prin strategii comunitare concrete și ferme.

    Trebuie să avem în vedere că micii fermieri din toate aceste zone de pe continent, afectate de deșertificare, sunt și ei în pericol. Nu au cum să se lupte singuri împotriva naturii și trebuie să le venim în ajutor. Au nevoie de susținere financiară europeană care să dubleze eforturile mai mari sau mai mici ale guvernelor naționale. Mizez pe înțelepciunea noastră comună și pe o reacție mai bine conturată a Comisiei pentru frânarea acestui fenomen natural periculos.

     
       

       

    Interventions à la demande

     
       


     

      Hélder Sousa Silva (PPE). – Senhor Presidente, Senhora Comissária, a desertificação é um desafio crescente que se coloca à União Europeia, especialmente nos Estados-Membros do Sul e, particularmente, próximos do Mediterrâneo.

    A falta de água, a exaustão dos solos e as alterações climáticas são, hoje, uma dura realidade nalgumas zonas da União e, além disso, assistimos também ao despovoamento de algumas regiões do interior por falta de atratividade e de competitividade.

    Portugal enfrenta cumulativamente estes dois problemas. As regiões do Alentejo e do Algarve evidenciam uma brutal falta de água, quer para agricultura, quer para consumo humano. E as regiões próximas da fronteira com Espanha sofrem de despovoamento.

    Em resultado destas duas situações, assistimos a fluxos migratórios do interior para o litoral, das zonas rurais para as zonas urbanas, que são verdadeiros problemas. Por isso, considero que o próximo quadro financeiro plurianual deve responder à desertificação e ao despovoamento e, assim, resolver o problema de coesão territorial que enfrentamos na nossa União.

     
       

     

      Seán Kelly (PPE).(Níor phioc an micreafón suas tús na hóráide) … labhairt ar an ábhar tábhachtach seo, gaineamhlú an domhain.

    And depending on who you’re listening to, between 20 % and 40 % of land is threatened with desertification, particularly in places like the Sahel, Gobi Desert, South America. I think it’s good that the European Union are now emphasising that deforestation, in particular, has to end in any free trade deals we’ll be doing.

    Within Europe, we will be shortly discussing the next CAP and, obviously, protection of the soil, nature restoration are going to be key in that. And I would make one suggestion: give every farmer in Europe a minimum of 50 trees native to their own area to set on their farm. This would help to restore nature, protect the soils and be a small step to end desertification.

    Bímis ag dul ar aghaidh de réir a chéile, mar de réir a chéile a dhéantar na caisleáin.

     
       

       

    (Fin des interventions à la demande)

     
       

     

      Jessika Roswall, Member of the Commission. – Mr President, honourable Members, your interventions show how important it is for the EU to continue tackling the interconnected challenges of droughts, land use, climate change, biodiversity loss and water scarcity together for our economy, our security and our livelihoods. They show that we are not ignoring the difficulties we face in the current geopolitical climate. And as many of you have also mentioned, we are all affected.

    I just also want to say – and this is to César Luena – that the Commission is not ignoring this. And I just want to repeat one thing that I said in my first remark: the Commission is responding to the recommendation of the European Court of Auditors by developing a methodology to assess land degradation and desertification for the EU.

    Although we didn’t leave Riyadh with all our desired outcomes, we should still acknowledge and build on the important progress that was made. So now we need to keep up the momentum. We need to accelerate implementation at national and international levels, and continue our work to agree on the outstanding COP16 decisions, especially on droughts.

    Many of you have underlined the importance of water and the need to make progress on strengthening our water resilience, so I also want to say – as I said earlier, and I know you know – that the Commission has made it a priority to present a new strategy on this.

    I know Parliament is already making progress on its reports on this. I thank you today for your input, and I look forward to close dialogue with you, with your rapporteur, Thomas Bajada, and all of you on this important topic, and of course, on continuing fighting desertification.

     
       


       

    (La séance est suspendue quelques instants)

     
       

       

    IN THE CHAIR: CHRISTEL SCHALDEMOSE
    Vice-President

     

    3. Resumption of the sitting

       

    (The sitting resumed at 10:29)

     

    4. Cryptocurrencies – need for global standards (debate)


     

      Magnus Brunner, Member of the Commission. – Madam President, honourable Members, first of all, sorry I’m a couple of minutes late – I was in the office, actually, but I didn’t make it here on time, I’m sorry about that. Also, thank you for the opportunity to contribute to this debate on the need to agree on global policy standards for crypto. As you may well know, these standards, of course, do exist and have been agreed in international fora. Let me give you a brief overview of how they came about and where the EU stands in their implementation.

    International regulatory and policy organisations have been working on international crypto standards for a number of years now. Early on, there was an international understanding that crypto markets are global markets and are largely unregulated and pose, of course, also risks that need to be addressed. And then in 2023 the G20 unveiled the crypto-asset policy implementation roadmap, which reflected the policy and regulatory responses developed primarily by the International Monetary Fund, the Financial Stability Board and standard-setting bodies covering specific areas of finance such as the International Organization of Securities Commissions on investor protection, or also the Financial Action Task Force on anti-money laundering.

    The core of these international standards on crypto are the FSB recommendations on crypto-asset markets and activities, and recommendations for global stablecoin arrangements. The European Union is the first major jurisdiction to have reflected those standards in law. We have done this by adopting the regulation on markets in crypto-assets (MiCA), which has now started to apply, and we have also amended other legislation such as the Anti-Money Laundering Directive and also the Transfer of Funds Regulation.

    We are strongly committed to ensuring the global implementation of international standards. We regularly advocate this in the relevant international fora in which we as a European Union participate.

    Implementation of international standards of course is necessary, not only to ensure a minimum level of policy and regulatory convergence internationally, but also to ensure that jurisdictions follow a sensible common denominator in addressing the risks also posed by the crypto markets. This is particularly important in crypto markets, which are global in nature, of course – yes, everyone knows that, with crypto exchanges and platforms operating across borders and assets also moving on open networks that are widely accessible.

    The adoption of international crypto standards has so far been incremental. Indeed, jurisdictions have made progress also in implementing the policy and also the regulatory responses developed by, as I said, the IMF, the FSB and the standard‑setting bodies. Almost all FSB jurisdictions have plans to develop new – or at least revise existing – regulatory frameworks for crypto.

    Information gathered at the international level suggests that the majority of FSB member jurisdictions expect to achieve alignment with the FSB framework by this year, by 2025. And this is of course very good news. We will continue to support relevant international organisations to ensure that the momentum we have now in implementing international standards on crypto is maintained. And we stand, of course, ready to work with jurisdictions that wish to benefit from our experience with MiCA. This includes the US. The US has been heavily involved in defining, together with other partners, the international standards on crypto, and I’m convinced that the new administration is fully aware of the fact that a robust policy response to crypto requires also an international effort.

    We therefore look forward, of course, to continuing working with the US authorities as they consider their policy approach to crypto assets and related service providers, and we would view it as a positive development if the US were to make progress on crypto‑specific legislation that would provide greater legal clarity on the treatment of crypto assets and related service providers, while at the same time also addressing the risks we are facing. And we believe existing international standards should form the basis of any crypto framework, including, of course, the one in the US, not least because they ensure international convergence in this area and contribute to a level playing field.

    Our experience in the European Union has shown that ensuring legal clarity is the right way to support innovation in these markets, while mitigating, on the other hand, of course, also the risks we are facing. Developments in the crypto market since the adoption of MiCA have only strengthened the case for legal clarity. Whatever approach the US ultimately takes, we do hope it will ensure that innovation flourishes while allowing, of course, on the other hand, also bad actors to be weeded out.

     
       

     

      Markus Ferber, im Namen der PPE-Fraktion. – Frau Präsidentin, Herr Kommissar, liebe Kolleginnen, liebe Kollegen! Diverse Kryptowährungen, allen voran Bitcoin, haben in den vergangenen Tagen Rekordkurse erklommen. Der Grund ist klar: Die neue Administration in den Vereinigten Staaten ist diese Woche ins Amt gekommen, und sie wird sehr viel kryptofreundlicher sein als die Vorgängerverwaltung. Der neue US-Präsident spricht gar davon, eine strategische Bitcoin-Reserve aufzubauen und die USA zum Krypto-Mekka der Welt machen zu wollen. Dass Donald Trump es wohl ernst meint, sieht man auch daran, dass er selbst einen eigenen Meme Coin aufgelegt hat, der wohl nur ein Ziel hat: seinen Reichtum noch etwas zu vergrößern. Ich glaube, die Anleger werden nichts davon haben.

    Unabhängig davon, wie man zu Kryptowährungen steht, unterstreicht diese Entwicklung ein grundsätzliches Problem: Obwohl Kryptowährungen ein globales Phänomen sind, haben wir keinen internationalen Ordnungsrahmen. Ein Regierungswechsel in den USA führt deshalb sehr schnell dazu, dass sich die Marktlage rapide verändert und da auch der Verbraucherschutz, auch für europäische Anleger, massiv unter die Räder kommt. In anderen Teilen des Finanzmarkts, vom Bankensektor bis zum Clearing, haben wir uns aus guten Gründen auf internationale Standards verständigt. Die haben wir im Kryptosektor bisher nicht, und das rächt sich jetzt auch.

    In der Europäischen Union sind wir mit der Verordnung über Märkte für Krypto-Assets, der MiCAR, weltweit Vorreiter. Wir haben in der EU ein glaubwürdiges Regelwerk geschaffen, das den Wildwest-Auswüchsen wie in den USA einen Riegel vorschiebt und gleichzeitig Vorhersehbarkeit und Planbarkeit für alle Marktteilnehmer schafft. Es gäbe also bereits eine Blaupause für internationale Mindeststandards. Deswegen, lieber Herr Kommissar, sollten wir von dieser Blaupause Gebrauch machen und auf internationale Lösungen hinwirken. Dass das nicht einfach ist, ist klar. Aber wenn wir nicht anfangen, werden wir es nie schaffen.

     
       

     

      Jonás Fernández, en nombre del Grupo S&D. – Señora presidenta, señor comisario, sin duda, yo creo que todos podríamos convenir en la necesidad de esas normas internacionales para el mercado de las cripto. Así he entendido las palabras de la Comisión apelando a la necesidad de fijar esos estándares mínimos.

    Pero, ciertamente, viendo lo que estamos viendo al otro lado del Atlántico, yo creo que deberíamos empezar a reconsiderar los buenos propósitos y empezar a trabajar más para proteger Europa, en un tiempo en que Donald Trump e incluso su mujer emiten su propia moneda —como decía mi colega Markus Ferber— en los días previos a tomar posesión, mostrando poco respeto, en mi opinión, por la propia institucionalidad. Deberíamos recibir el mensaje en Europa, y yo creo que el mensaje que tenemos que recibir es que no podemos contar con la Administración estadounidense en los próximos años para llegar a ningún tipo de acuerdo mínimo sobre criptomonedas.

    Por lo tanto, en vez de apelar a los buenos propósitos en los que llevamos empeñados años, deberíamos tener una posición mucho más asertiva y ser conscientes de que ese escenario va a ser casi imposible y que, por lo tanto, tenemos que aplicar el Reglamento MiCA —claro que hay que aplicar el Reglamento MiCA—, pero tenemos que también proteger a nuestro sector financiero, a nuestros bancos y a nuestros seguros de posibles impactos de inestabilidad financiera derivada de las cripto más allá de Europa. Y debemos también acelerar la negociación para tener un euro digital en Europa que permita ofrecer una respuesta propia a las necesidades, al parecer, de algunos inversores.

     
       


     

      Marlena Maląg, w imieniu grupy ECR. – Szanowni Państwo. Unia Europejska dzięki wprowadzeniu przepisów MICA stała się globalnym pionierem w regulacji rynku kryptoaktywów, wyzwalając je tak naprawdę z szarej strefy. Należy docenić fakt, że regulacja MICA wprowadza obowiązek raportowania, zapewnia mechanizmy kontroli wewnętrznej oraz wymaga separacji aktywów klienta od aktywów dostawców usług kryptowalutowych. To podstawy, które zapewniają większą przejrzystość, bezpieczeństwo inwestorów. Co ważne, zabezpieczone są także interesy państw członkowskich spoza strefy euro.

    Kryptowaluty, jak wiemy, nie mają granic. Musimy sobie jednak jasno powiedzieć, że różnice między krajami znacząco obniżają atrakcyjność tego rynku i spowalniają jego rozwój. Dlatego konieczne jest wypracowanie globalnych standardów regulacyjnych. Unia Europejska, choć jest liderem w tej dziedzinie, musi uważać, by nie przyjąć jak zwykle zbyt restrykcyjnego podejścia, które mogłoby wepchnąć innowacje, inwestycje w bardziej elastyczne rynki spoza Unii Europejskiej.

    Jeszcze niedawno kryptowaluty ożywiały marzenia części inwestorów o infrastrukturze finansowej niezależnej od banków centralnych. Dziś te marzenia nieco osłabły. Ale kryptowaluty są i będą trwałym elementem globalnej gospodarki. Naszym zadaniem jest traktowanie kryptowalut jako narzędzi finansowych, które wymagają odpowiedniej regulacji, ale bliskich rynkom tradycyjnym, takich regulacji, które zapewnią bezpieczeństwo inwestorom, nie tłumiąc jednocześnie innowacji. Nie możemy przespać tej rewolucji. Przyszłość rynku kryptowalut wymaga równowagi między ochroną interesów klienta a umożliwieniem przede wszystkim dalszego rozwoju.

     
       

     

      Stéphanie Yon-Courtin, au nom du groupe Renew. – Madame la Présidente, Monsieur le Commissaire, aux États-Unis, Donald Trump se rêve en président de la crypto. Résultat, la cryptosphère s’enflamme, une cryptomonnaie créée à son effigie et une autre dédiée à Melania, le bitcoin qui s’envole et la démission du président de l’Autorité des marchés financiers américains. Pendant ce chaos, en Europe, nous avons fait un choix différent: réguler pour protéger.

    Avec le règlement MiCA, nous avons posé les bases d’un marché des cryptomonnaies sécurisé, imposant des mesures solides contre le blanchiment d’argent et contre le financement du terrorisme, comme par exemple la vérification des identités et le signalement des activités suspectes. Car oui, les cryptomonnaies ont des avantages. Elles offrent de nouvelles opportunités d’investissement, encouragent les plus jeunes à venir investir, et permettent un soutien vital face à des systèmes corrompus ou en zone de guerre, comme pour la diaspora ukrainienne.

    Mais elles ne doivent pas devenir une jungle mondiale au service des fraudeurs et des criminels. À ceux qui, en Europe, flirtent avec les leaders américains du bitcoin: savez-vous que leur véritable objectif est de contourner nos devises officielles, à commencer par l’euro, et de saboter notre système monétaire en Europe? Drôles de souverainistes. Comme pour l’intelligence artificielle ou la taxation minimale, l’Europe doit pousser pour un cadre mondial. Les cryptomonnaies ne doivent pas devenir un eldorado pour les tricheurs, mais un outil au service de tous les investisseurs 2.0.

    Monsieur le Commissaire, agissez maintenant pour adopter au plus vite des normes mondiales minimales. Il y va de la souveraineté de l’Europe, de celle de l’euro et de la protection de nos concitoyens européens.

     
       

     

      Rasmus Andresen, im Namen der Verts/ALE-Fraktion. – Frau Präsidentin! Seit knapp einer Woche gibt es den Trump Meme Coin – ökonomisch wertlos und für Trump‑Fans vor allem eine emotionale Bindung zu ihrem großen Idol. Der TrumpCoin ist eine Betrugsmaschine, das zum Teil auch ausländische Geld geht in die Kassen der Trump‑Familie. Während Ex‑US‑Präsident Jimmy Carter Ende der 70er-Jahre noch seine Erdnussfarm verkaufen musste, als er gewählt wurde, betrügt Trump auf der ganzen Linie. Aber der TrumpCoin ist vor allem auch eine Symbolik für eine andere US‑Politik im Bereich der Kryptowährungsregulierung, und das sollte uns Sorgen machen. Wir sollten hier ganz klar feststellen, dass Anlagen in Kryptos mit hohen Risiken verbunden sind und dass wir auch wissen, dass das Geldwäscherisiko bei Kryptowährungen deutlich höher ist als in anderen Bereichen.

    Der Mehrwert, der durch Kryptowährungen geschaffen wird, ist fraglich. US‑Präsident Trump öffnet mit blinder Deregulierung und auch, indem er Krypto‑Ultras in wichtige Finanzämter in seiner Administration befördert, der Privatisierung des Währungssystems Tür und Tor. Lassen Sie mich ganz klar sagen: Das darf nicht der europäische Weg sein. Ich bin froh, dass eigentlich aus den großen Fraktionen fast alle Redner auch Skepsis zum Ausdruck gebracht haben und deutlich gemacht haben, dass wir auf der einen Seite internationale Standards brauchen – ja –, aber dass wir nicht den Kurs einschlagen sollten, den die Trump‑Administration hier auf den Weg bringt.

     
       


     

      Pasquale Tridico, a nome del gruppo The Left. – Signora Presidente, signor Commissario, onorevoli colleghi, mentre negli Stati Uniti, con l’insediamento di Trump, il Bitcoin raggiunge valori storici e persino una moneta meme di Trump guadagna miliardi di capitalizzazione, in Europa il dibattito sulle valute digitali resta fermo, specialmente per quanto riguarda l’euro digitale.

    L’euro digitale emesso dalla Banca centrale europea rappresenterebbe una risposta pubblica, sicura e indipendente, a sostegno della nostra autonomia strategica ed economica rispetto alle criptovalute, che, a causa della loro volatilità e della mancanza di regolamentazione, non possono offrire un metodo di pagamento stabile.

    Questo progetto, però, rimane bloccato per alcuni paesi che mettono il veto e gruppi politici. Noi, invece, sosteniamo con forza l’introduzione di questo strumento, perché garantirebbe l’indipendenza strategica dell’Europa dai colossi stranieri, principalmente americani, che monopolizzano i pagamenti elettronici, permetterebbe la costruzione di un’infrastruttura europea per i pagamenti digitali, ridurrebbe i costi di transazione per consumatori e venditori e, inoltre, aumenterebbe la stabilità finanziaria.

    L’euro digitale rappresenterebbe anche una risposta cruciale nella lotta all’evasione, che ogni anno priva il welfare europeo di 824 miliardi di euro di gettito fiscale.

    Commissario, Le chiediamo un passo in avanti rispetto all’euro digitale.

     
       

     

      René Aust, im Namen der ESN-Fraktion. – Frau Präsidentin! In den vergangenen Jahren sind weltweit die staatlichen Möglichkeiten gewachsen, uns Bürger zu überwachen. Der Wunsch, sich gegen diese Überwachung zu schützen, wächst jedoch ebenso. Darum erleben Kryptowährungen wie Bitcoin einen solchen Aufschwung. Während der Coronazeit haben wir beispielsweise in Kanada erleben müssen, wie unliebsamen Regierungskritikern die Konten gesperrt wurden. Manche Betroffene hatten nach diesen Kontoschließungen nicht einmal mehr die Möglichkeit, ihre Mieten zu bezahlen. Kryptowährungen schützen durch Verschlüsselungstechnologien unsere Bürger vor übergriffigen Staaten. Gut so!

    Darüber hinaus wollen wir, dass unser Geld sicher ist vor staatlicher Manipulation. Immer mehr Gelddruckerei durch Zentralbanken entwertet das Geld weltweit. Der Euro hat seit dem Jahr 2001 um mehr als ein Drittel seiner Kaufkraft verloren. Darum wollen viele Bürger eine manipulationssichere Währung. Auch das versprechen Kryptowährungen. Im Übrigen: Wenn hier gerade davon gesprochen wird, dass Terrorfinanzierung und Drogenfinanzierung durch Bitcoin begangen wird: 90 Prozent aller Terrorfinanzierungen finden nach wie vor durch Dollar oder Euro statt. Wir setzen uns für die Souveränität unserer Nationen ein, aber genauso setzen wir uns ein für die Souveränität unserer Bürger. Wir trauen ihnen zu, für sich selber zu entscheiden. Darum wollen wir Neuerungen wie Bitcoin und Co. auch weiterhin zulassen, und zwar so, dass nicht Politiker, die keine Ahnung von diesen Dingen haben, darin rummanipulieren. Die neue Trump‑Regierung macht es vor: keine Angst vor Innovation, sondern die Chancen ergreifen. Technologieoffenheit also auch im Finanzbereich.

     
       

     

      Regina Doherty (PPE). – Madam President, colleagues, we have spent the last few months since I’ve been here intensively talking about the importance of innovation, and it is clear that, despite all of the risks it entails, crypto stems from a desire to innovate and operate outside traditional norms and structures.

    In general, legislators and regulators should focus on creating the conditions for innovation and sectors to thrive. But in this case, there’s vital issues of trust, consumer protection and there is obviously the serious potential for financial crime that still exists.

    And yet, on the other side of the Atlantic, we hear the promises of the new administration of the sector, even as the President’s own meme coins were launched and then crashed and lost half their value in the space of one weekend.

    I think there are serious questions that have to be asked about a situation where the most powerful politician and one of the richest men in the world can self‑enrich himself through a scheme while purporting to be in charge of the regulators of that particular innovation? And while these questions go unaddressed, the cryptocurrency industry will continue to face serious pushback by some of us in this Chamber and outside.

    The EU’s legal framework for the sector seeks to promote innovation while tackling market abuse and the very large elements of criminality, and its full implementation has literally only just begun, it’s in its infancy. So, I hope that when we eventually come to review and have an international standard, that our efforts will be used for that global standard.

     
       

     

      Eero Heinäluoma (S&D). – Madam President, despite the hurray mood in parts of the crypto world since the election of Trump, it’s important to look at the facts. I see at least three reasons to remain concerned about this bubble.

    Firstly, despite all the measures adopted, crypto seems to remain the favourite tool for sanctions evaders and gangsters, including cocaine cartels, North Korean hackers, Iranian and Russian spies and fentanyl smugglers. If we want to tackle these problems seriously, let’s hit them where it hurts. Secondly, as well outlined by the ECB, the recent rise in Bitcoin value benefits mainly a happy few at the expense of the many. From an investor protection perspective, this is far from optimal. Finally, in times of high energy prices and energy scarcity, investing in infrastructure to mine bitcoins is wasting energy.

    Therefore, it is good to have this debate. We indeed need global standards for crypto to tackle these challenges, and the EU should take the lead as MiCA and the AML package can give some inspiration. But we should go further and we need a MiCA 2 to close remaining regulatory loopholes, for example, around NFTs and decentralised finance applications. We count, therefore, on this new commission to pick up this role and push this agenda forward.

     
       

     

      Aleksandar Nikolic (PfE). – Madame la Présidente, comme avec Internet, le cloud et l’IA, nous sommes une fois encore à la charrette des grandes puissances sur la cryptomonnaie. 10 % des Européens détiendraient des cryptomonnaies. En France, ils seraient déjà 12 %, soit plus de 8 millions de Français. Et cela continue d’augmenter.

    Et vous? Votre premier réflexe, c’est d’avoir peur. Ce n’est pas de savoir comment investir dans cette nouvelle technologie, la fameuse chaîne de blocs, mais comment la réguler, comment taxer les profits de monsieur Tout-le-Monde et comment la contrôler. Car au fond, c’est ça qui vous terrifie dans le monde de la crypto: il échappe aux technocrates. Quand il y a une nouvelle technologie, immédiatement vous en avez peur et vous voulez la réguler.

    Nous, on se demande comment s’y adapter et comment en tirer profit. Nos préoccupations sont: pourquoi l’Europe n’innove plus et comment utiliser ces technologies pour booster notre compétitivité. Plutôt que de taxer, favorisons l’investissement dans l’industrie européenne et l’économie réelle, incitons les détenteurs de crypto à transformer les plus-values en actions dans des entreprises innovantes, faisant en sorte que les futurs Nakamoto ou Musk soient européens et créent des technologies de rupture sur notre sol. Soyons enfin un continent d’avenir. Oui, il faut rendre la crypto utile et pour cela, il faut se débarrasser des technos inutiles.

     
       

     

      Guillaume Peltier (ECR). – Madame la Présidente, partout, le socialisme mène à la ruine. Il y eut, certes, l’URSS, Cuba, l’Angola ou le Brésil qui se réveillèrent pauvres comme jamais. Mais aujourd’hui, c’est l’Europe que les gauches tentent d’asservir. Pas un jour qui ne passe sans que les politiciens de gauche n’inventent, en France ou ailleurs, une nouvelle norme, une nouvelle taxe, une nouvelle contrainte. Pas un jour qui ne passe sans que les vieilles gauches sur ces bancs ne hurlent contre le mérite, l’effort, le succès, le travail. Alors, je le dis à tous ces politiciens: laissez-nous tranquilles. Quand laisserez-vous respirer les entrepreneurs et les originaux de tout poil dont vous sabordez le talent?

    Le pénible babil technocratique de ce débat sur les cryptomonnaies est le symptôme d’une Europe en dormition, épuisée par la fièvre socialiste. Dépassée et déclassée, voilà l’Europe que vous proposez au monde, transformant la terre de Jacques Cœur en mouroir de l’esprit d’entreprise. Pire: à l’heure où le monde entier fait le choix de la liberté avec Donald Trump, Elon Musk ou Javier Milei, vous voulez nous contraindre à la relégation. Pourtant, l’histoire est têtue. En connaissez-vous beaucoup des gens de gauche qui, à la chute du mur de Berlin, se sont enfuis à l’Est? Le monde entier s’éveille et vous, la gauche, vous voulez continuer à dormir de vos vieilles lunes ou, pire, vous ronflez de vos impôts fatigués. Alors écoutez bien: nous ne voulons plus de vous, nous ne voulons plus être ni taxés ni spoliés, nous voulons être libres!

     
       

     

      Gilles Boyer (Renew). – Madame la Présidente, Monsieur le Commissaire, les cryptomonnaies gagnent d’évidence en popularité. Elles fonctionnent en dehors de toute législation financière et dans l’anonymat le plus total. Comme tout instrument de spéculation, elles feront la fortune des uns et l’infortune des autres, sans jamais contribuer à l’économie réelle. Mais n’oublions pas, et c’est notre rôle, que c’est avant tout à la puissance publique d’organiser la circulation des monnaies en s’adaptant aux nouveaux usages et de garantir la stabilité et l’utilisation de l’euro.

    C’est le sens du projet d’euro numérique, un équivalent à l’argent liquide dans un portefeuille numérique, émis et garanti par la Banque centrale européenne, à l’inverse des cryptomonnaies. Ce sera un moyen de paiement gratuit, sécurisé, accepté partout en Europe, même dans les zones sans connexion Internet et avec, dans certains cas, un niveau d’anonymat similaire à l’argent liquide. L’euro numérique permettra à l’Union européenne de préserver et de renforcer sa souveraineté monétaire dans un secteur des paiements de plus en plus numérisé. Les colégislateurs doivent s’y atteler sans tarder, au premier rang desquels notre Parlement.

     
       


     

      Catarina Martins (The Left). – Senhora Presidente, todas as épocas tiveram as suas bolhas e fraudes financeiras. Hoje, são as criptomoedas, uma burla disfarçada de investimento, que gera uma montanha de poluição sem produzir um alfinete.

    Sem surpresa e sem escrúpulos, Trump acaba de anunciar a criação da sua própria criptomoeda, que será regida pelas regras que o próprio criará como presidente dos Estados Unidos. Como em qualquer esquema de pirâmide, só os criadores, como Trump, sairão sempre cheios de dinheiro, mas, neste caso, dinheiro real, euros, dólares. Os incautos e deslumbrados vão perder tudo.

    Senhor Comissário, ao permitir as criptomoedas a pretexto da regulação, as instituições europeias estão a normalizar a burla, contribuindo para enganar cidadãos e, ao permitir aos bancos a constituição de carteiras de criptoativos, estão a criar um mecanismo crescente de contágio aos mercados, ignorando até os avisos do FMI. Na crise do Silicon Valley Bank, já tivemos um cheiro deste mecanismo.

    Sejamos claros: regular as criptomoedas tem de ser proibir as criptomoedas, impedir os bancos de as comprar, proteger as pessoas da burla, evitar a próxima crise financeira.

     
       


     

      Kateřina Konečná (NI). – Paní předsedající, vážený pane komisaři, vážené kolegyně, vážení kolegové, kryptoměny s sebou nesou příslib inovací, ale také celou řadu rizik. Miliony lidí v nich vidí příležitost, ale bohužel je zde i mnoho těch, kteří kvůli podvodům a nejasným pravidlům již přišli o své celoživotní úspory. A to vyžaduje od států a jejich institucí velkou opatrnost. Kryptoměny nelze apriori odmítat. Přináší nové možnosti v oblasti financí, nezávislosti i v investicích. Nicméně je nezbytné, aby jejich rozvoj byl ukotven v jasných principech. Jedním z těch klíčových je i právo občanů platit hotově, což považuji za základní svobodu, kterou musíme chránit. Nové metody oběhu finančních prostředků nemohou vést k zániku těch stávajících, které slouží právě jako pojistka celého systému. Kryptoměny a blockchain mohou ohrozit například prudký vývoj kvantových počítačů. Na toto všechno musíme být připraveni. Proto vyzývám k vytvoření globálních standardů, které zajistí ochranu uživatelů, jejich případné odškodnění v případě podvodů, transparentnost trhu, pravidla zdanění a zároveň respekt k finančním právům občanů.

     
       

     

      Kinga Kollár (PPE). – Tisztelt Elnök Asszony! Világszinten növekedik a kriptoeszközökbe való befektetések volumene. Ugyanakkor az nem kérdés, hogy ez a befektetési forma különösen kockázatos. Ezért az ilyen termékekkel való kereskedéshez nagyfokú pénzügyi jártasság és tudatosság szükséges.

    Legyünk reálisak! Egy OECD-jelentés szerint a befektetők kevesebb, mint fele érti a kamatos kamat számítását, így azt gondolom, jól tettük, hogy Európa megfelelő időben a szabályozás mellett tette le voksát, és globális standardokért harcol.

    Hiszen jól tudjuk a kétezres évekből, hogy a pénzügyi válságok nem állnak meg a határokon. Az áttekintő szabályozást az is indokolja, hogy a kriptoeszközök a feketegazdaság valutájaként is funkcionálnak.

    Ugyanakkor a túlszabályozást is el kell kerülnünk, mert az sem elfogadható, hogy a szabályozás akadályozza az európai innovációt, és ezáltal az európai vállalkozások lemaradnak a globális piacokon.

    Versenyképesség, prudencia, fogyasztóvédelem és a magas standardok globális kiterjesztése. Ez az irány, amit követnünk kell, de még inkább a pénzügyi ismeretek és tudatosság növelésére van szükség, mert ez a kulcs ahhoz, hogy az európai állampolgárok jó befektetési döntéseket hozzanak, és ezáltal növeljék vagyonukat, Európa vagyonát.

     
       

     

      Aurore Lalucq (S&D). – Madame la Présidente, Monsieur le Commissaire, chers collègues, parce que sans régulation, le marché des crypto-actifs, ce ne sont pas des monnaies, ce ne sont pas des technologies, ce sont des actifs financiers. Ce serait fait d’arnaques, de financements, de pratiques illicites en tout genre, dont celle du financement de groupes terroristes tels que Daesh. Nous avons choisi de les réglementer dans un climat hostile, violent, toxique, fait de menaces et de cyber-harcèlement.

    Il est donc cocasse de voir aujourd’hui que ceux-là mêmes qui nous harcelaient à l’époque et hurlaient qu’ils allaient partir aux États-Unis à cause de nous, se plaignent des pratiques actuelles de l’administration de Donald Trump, lequel a déstabilisé le marché avec le lancement de son «coin». Ils sont en train d’expérimenter ce qu’est la loi du plus fort quand elle ne leur est pas favorable. Donc oui, évidemment, comme nous l’avons toujours dit, il nous faut des réglementations au niveau international. Il faut aussi protéger la nôtre, se renforcer sur la question de la stabilité financière, mais surtout, par pitié, ne perdons pas trop de temps avec ce débat. On sait ce qu’il faut faire dans le domaine des cryptomonnaies. En revanche, on doit avancer en ce qui concerne l’euro numérique et la création de nos propres «big tech».

     
       

     

      Mathilde Androuët (PfE). – Madame la Présidente, l’essor des cryptomonnaies est un défi majeur pour nos États et pour l’Union européenne. Ces systèmes alternatifs, échappant souvent au contrôle des banques centrales, ne doivent pas compromettre un principe fondamental: la souveraineté monétaire des nations. La monnaie est un attribut régalien indispensable pour garantir la stabilité économique et protéger nos concitoyens.

    Pourtant, pendant que l’Europe s’interroge, d’autres pays avancent à grands pas. Les États-Unis, par exemple, ne se contentent pas d’encadrer ces nouvelles technologies; ils les soutiennent, les développent et les utilisent comme un levier d’influence stratégique à l’échelle mondiale. De leur côté, la Chine et d’autres puissances investissent massivement pour asseoir leur domination numérique.

    Face à cela, l’Europe ne peut rester figée dans une culture de la surréglementation. Certes, il est essentiel de garantir un cadre sûr, transparent et respectueux de nos valeurs. Mais réglementer sans agir, c’est accepter de subir. Nous devons changer de paradigme. Investissons dans les technologies numériques comme la chaîne de blocs, soutenons les entreprises innovantes et encourageons l’émergence de solutions européennes compétitives. Il en va de notre souveraineté économique et monétaire.

    Nous ne pouvons pas laisser des acteurs extérieurs imposer leurs règles, dicter leurs normes et nous asservir à des technologies qu’ils contrôlent seuls. Soyons ambitieux, bâtissons une Europe qui ose, qui innove et qui s’affirme comme un leader mondial. Oui, l’avenir de notre souveraineté ne s’écrira pas dans l’attentisme; l’Europe doit être forte, visionnaire et audacieuse.

     
       

     

      Adrian-George Axinia (ECR). – Doamnă președintă, un aforism care a devenit celebru în ultimii ani este că regulile fizicii se aplică indiferent dacă noi credem sau nu în ele. Parafrazând și luând în considerare propunerea de reglementare Markets in Crypto Assets (MiCA) putem spune că aceste monede virtuale vor exista, indiferent dacă Uniunea Europeană sau orice alt stat membru crede că sunt bune sau încearcă să le controleze total. Ceea ce nu înțelege Comisia Europeană, ține de rațiunea de a exista a acestor criptomonede.

    Li se aplică logica unei monede bazate pe încredere, a cetățenilor sau a piețelor. Or, apariția acestor monede virtuale este mai degrabă rezultatul neîncrederii în modul de funcționare a economiei și al sistemelor politico-administrative complexe. Mulți se refugiază în cripto pentru a-și proteja valoarea proprietății în fața inflației, a turbulențelor financiare și economice, dar și ca tentativă de ocolire a unui sistem Big Brother care vrea să știe la secundă ce face fiecare cetățean cu banii.

    În forma actuală, Markets in Crypto Assets va eșua tocmai din dorința prea mare de a intra în intimitatea oamenilor și de a verifica și controla fluxurile financiare. Exact cum s-a întâmplat și cu tentativa de interzicere sau limitare a plăților cash.

    Abordarea propusă de Comisie este deci mai aproape de China, unde tranzacțiile cripto sunt interzise, decât de un sistem financiar deschis spre inovație. Inclusiv în această privință, Bruxelles-ul ar avea de învățat de la noua administrație de la Washington.

     
       

     

      Cynthia Ní Mhurchú (Renew). – A Uachtaráin, criptea-airgeadraí. Forbairt mhór teicneolaíochta, gan dabht, le deiseanna dearfacha ar nós córas airgeadais níos ionchuimsithí, idirbhearta trasteorann níos tapúla agus féidearthachtaí réabhlóideacha trí theicneolaíocht bhlocshlabhra. Níor chóir dúinn san Eoraip neamhaird a dhéanamh de chriptea. Ach, ná ligimis orainn go mbeidh sé seo brea éasca.

    Tá fíordhúshlán ag baint leis na deiseanna seo. Guagacht praghsanna, gníomhaíochtaí mídhleathacha agus easpa cosaintí láidre do thomhaltóirí. Ábhair imní dhlisteanacha iad seo a éilíonn freagairt láidir shoiléir, ach, ag an am céanna, níor cheart dúinn rialú iomarcach a dhéanamh ar bhonn eagla na heagla. Má dhéanaimid nuálaíocht a thachtadh, tá an baol ann go gcaillfimid an borradh díreach céanna a d’fhéadfadh ceannaire domhanda a dhéanamh den Eoraip sa gheilleagar digiteach.

    Seachas sin, caithfidh ár gcur chuige a bheith cliste, ag féachaint chun tosaigh agus réidh le lúbadh mar a oireann. Tá rialacha ag teastáil a chuireann trédhearcacht chun cinn, mar shampla cosaintí láidre i gcoinne sciúradh airgid agus cosaintí do thomhaltóirí. Ar an gcaoi chéanna, ní mór dúinn an nuálaíocht a chothú trí oibriú le nuálaithe príobháideacha, trí chreataí solúbtha a chruthú. I ndeireadh na dála, tá deis ar leith ag an Eoraip anseo le criptea. Ba chóir dúinn an deis a thapú.

     
       

     

      Giuseppe Antoci (The Left). – Signora Presidente, signor Commissario Brunner, onorevoli colleghi, Europol ci segnala un incremento nell’uso criminale delle criptovalute nel riciclaggio di denaro e per la richiesta dei riscatti dopo gli attacchi informatici. La blockchain facilita trasferimenti rapidi di capitali a livello globale, offrendo ai criminali un vantaggio significativo.

    Nel campo della cibercriminalità emergono tecniche avanzatissime, che richiedono competenze elevate degli investigatori. Tali competenze necessitano di personale adeguatamente formato.

    Inoltre, cresce l’uso di criptovalute ancorate al valore delle materie prime, apprezzate dai capi criminali per la loro stabilità e facile comprensione.

    La mancanza di strumenti adeguati per il tracciamento delle criptovalute in alcuni Stati membri sta facendo aumentare le richieste di supporto investigativo a Europol.

    Di fronte a queste sfide – e conoscendo la Sua grande sensibilità – è essenziale un impegno coordinato per sviluppare standard globali e condivisi, al fine di combattere efficacemente l’uso illegale di questa tecnologia.

     
       

     

      Marcin Sypniewski (ESN). – Pani Przewodnicząca! Noblista Fryderyk von Hayek powiedział, że nie ma odpowiedzi, dlaczego monopol na emisję pieniądza jest taki niezbędny w dzisiejszym świecie. I gdy po kryzysie w 2008 roku chroniliście banki przed upadkiem, do którego pośrednio doprowadziliście, to programista czy grupa programistów, znani jako Satoshi Nakamoto, powiedzieli „dość”. Powiedzieli dość pokusie nadużycia, z której korzystają rządy i banki, dość psucia pieniądza przez jego emisję, dość fałszywemu pieniądzowi. I w ten sposób powstał bitcoin. Jest to najlepszy kandydat do stania się pieniądzem. Jest rzadki, podzielny, trudny do podrobienia, a przede wszystkim nie uznaje nad sobą dyktatów rządów i banków. Jest też antykruchy. I wszystkie te zakusy, żeby go ograniczyć, tylko go wzmacniają. I patrząc na te wszystkie proponowane ograniczenia, wiem chyba, jaka jest odpowiedź na pytanie Hayeka. Powiedział on, że najgorszym monopolem w rękach rządów jest monopol na pieniądz. I te dążenia do ograniczenia kryptowalut wynikają z tego, że są to niepaństwowe środki wymiany, które wygrywają z inwigilowanym, przeregulowanym pieniądzem dekretowym. Pamiętajmy o tym, że pieniądz powinien służyć ludziom, a nie – elitom.

     
       

     

      Luis-Vicențiu Lazarus (NI). – Doamnă președintă, stimați colegi, România a fost teatrul unor operațiuni financiare absolut tragice pentru poporul român în anii 90. Scheme Ponzi implementate de tipi care erau manipulați de servicii secrete și politicieni au reușit să devalizeze buzunarele poporului român.

    Ulterior, sigur, societatea a evoluat. În 2001 au apărut avioanele care au dărâmat blocurile gemene și, sigur, a început războiul împotriva terorismului. În 2008 a apărut Bitcoin pe fondul crizei din America, criză ce s-a transferat și în Europa, desigur, și ulterior criptomonedele au luat avânt.

    V-ați gândit, poate, că acest imbold al statelor împotriva cetățeanului de a bloca deținerea cash-ului a favorizat acest avânt al criptomonedelor? Și acum, noi vrem să reglementăm. A apărut acest regulament MiCA ce reglementează anumite lucruri, dar nu reușește să facă o diferență între oamenii care au rea-voință de la început și oamenii care într-adevăr vor să facă proiecte serioase în criptomonede.

     
       


     

      Lídia Pereira (PPE). – Senhora Presidente, mais do que exportar legislação, a Europa tem de exportar inovação. Mas vamos ser claros: não fomos pioneiros na tecnologia que suporta os criptoativos e devíamos ter sido, mas para criar o regulamento, obrigações e burocracias, aí não perdemos tempo.

    É evidente que os criptoativos precisam de um quadro legal. São um ativo financeiro, por isso, há mínimos de transparência e, muito importante, de proteção do investidor. Mas é também evidente que essas leis têm de garantir segurança e previsibilidade para quem quer inovar e investir.

    Se aqui na Europa não estamos a garantir nem uma coisa nem outra, como vamos defender uma regulação global? Primeiro, temos de garantir que o regulamento de mercado de criptoativos é bem implementado. Segundo, temos de apoiar a inovação em blockchain com a consciência de que é uma tecnologia que não se esgota em criptomoedas, mas que pode e deve ser aplicada noutras áreas. Terceiro, temos de perceber que criptomoedas são hoje ativos financeiros como qualquer outro.

    Tentar uma regulação global tem impacto na concorrência livre, na dinâmica do mercado e na liberdade financeira das pessoas. Não podemos viver num faroeste financeiro, quando falamos de criptomoedas, mas também não podemos aprisionar novos projetos, novas ideias e novos investimentos que criam emprego e oportunidades.

    Este já não é o tempo de desconfiar de tudo quanto é novo, é o tempo de confiar naqueles que inovam, que investem, que fazem futuro no presente.

     
       


     

      Nikos Papandreou (S&D). – Madam President, Commissioner, from this discussion I think the answer is staring us in the face.

    We have two distinct philosophies, one on one side of the Atlantic and one on the other side. The US is a free market, let it bloom, let’s have the $TRUMP coin and then we regulate. Ours is let’s regulate and see what happens.

    What’s happening now is, besides the criminal activities with crypto, it’s also used by poor people in countries with inflation. So they put it into crypto, a very unsafe coin, and then turn it back into their currency.

    What we need to do is to create the Spinelli coin, which is the digital euro, and to have our own digital crypto competing so that we can impose international standards with safe asset from Europe.

    We will not be able to regulate the huge space from the rest of the world, unless we have our own digital coin that people will trust in, not only in Europe but internationally. MiCA helps on that. The way we will impose international standards and MiCA is by having our own innovation and our own Europe.

    (The speaker agreed to take a blue-card question)

     
       

     

      Diana Iovanovici Şoşoacă (NI), întrebare adresată conform procedurii „cartonașului albastru”. – Ați vorbit de regulamentul MiCA. Aici avem o regulă în care se menționează că ofertanții sau persoanele care solicită admiterea la tranzacționare cu criptoactive, altele decât jetoanele de referință la active și jetoanele de bani electronici, trebuie să fie persoane juridice, să publice o carte albă, iar următoarea regulă este: să acționați cinstit, corect și profesional. Puteți să-mi spuneți, vă rog frumos – și în calitate de avocat, vă întreb – cum veți ajunge la concluzia că persoana respectivă acționează cinstit, corect și profesional, înainte de a fi în calitatea lor de ofertanți sau persoanele care solicită admiterea la tranzacționare?

     
       


     

      Angéline Furet (PfE). – Madame la Présidente, la chaîne de blocs et les cryptomonnaies sont nées d’une idée simple: redonner le contrôle aux individus, renforcer la transparence et garantir un accès équitable à des systèmes ouverts. Décentralisation, transparence et sécurité sont donc les valeurs fondamentales de cette révolution. Mais aujourd’hui, la chaîne de blocs va bien au-delà des transactions financières. Elle révolutionne la gestion des données, la traçabilité et la confiance numérique en transcendant les frontières et en appelant à une coopération mondiale. Cependant, avec cet immense potentiel viennent aussi des défis: fraudes, inégalités d’accès et manque de réglementations claires.

    C’est donc ici que réside notre responsabilité collective. Il faut bâtir des normes mondiales, non pas pour étouffer l’innovation, mais pour l’encadrer et l’amplifier. Ces normes doivent donc 1) sécuriser les utilisateurs; 2) préserver la décentralisation; 3) favoriser un cadre propice à l’innovation.

    L’Europe, avec des initiatives comme le règlement MiCA, a démontré qu’une réglementation, bien que partielle, est envisageable. Elle doit donc maintenant agir comme un pont pour initier un dialogue mondial. La chaîne de blocs est une chance unique de construire des systèmes plus justes et équitables. Ensemble, nous pouvons orienter cette révolution vers un avenir plus ouvert et prospère.

     
       

     

      Ondřej Krutílek (ECR). – Vážená paní předsedající, vážený pane komisaři, ke kryptoměnám musíme přistupovat konstruktivně. Od loňského roku platí nařízení MiCA a já věřím, že jeho zavádění do praxe probíhá bez větších problémů.

    V Česku se díky našemu poslanci Jiřímu Havránkové podařilo prosadit jak automatické právo na zřízení bankovního účtu pro kryptopodnikatele, tak osvobození od daně při prodeji kryptoměn po třech letech. Myslím si, že tímto přístupem by se mohly inspirovat i další evropské státy. Naopak nápady typu zdanění nerealizovaných zisků z kryptoměn, které slyšíme z některých zemí, bych opravdu nedoporučoval.

    Američané mají k regulaci kryptoměn odlišný přístup, a tak se domnívám, že dosažení globálních standardů minimálně v tuhle chvíli nepřichází v úvahu. I proto bychom měli být opatrní s jakoukoli další možnou regulací od nás z Evropské unie. Důležité je, aby přehnaná regulace a nepředvídatelné právní prostředí nemotivovaly startupy a další firmy k úprku z Evropy.

    Pokud se bavíme o blockchainu, je to technologie budoucnosti, která nabízí řadu praktických aplikací. Příští týden v úterý pořádám v Bruselu akci, na kterou bych vás chtěl všechny pozvat. Bude na ní mimo jiné představen i projekt Českého vysokého učení technického a půjde o inovativní blockchainovou platformu pro decentralizované vydávání dluhopisů pro malé a střední podniky. Tak se stavte.

     
       


     

      Adnan Dibrani (S&D). – Fru talman! Kommissionär! Kryptovaluta, som en gång varit väldigt nischat, har snabbt fått genomslag i hela världen. Det är också en digital revolution som öppnat upp nya möjligheter inom andra sektorer.

    Det finns en stor potential i blockchain‑tekniken som kan innebära vinster för till exempel offentlig sektor, för mer robusta och effektiva system. Just nu undersöks därhemma till exempel hur vi ska använda den här tekniken inom vården, för att kunna säkrare hantera och dela personlig hälsodata.

    Det är viktigt att vi främjar ny teknik när den kommer, men samtidigt är det viktigt att den nya tekniken har en viss kontroll. Teknik får inte användas för att skada konsumenter, för terrorismfinansiering, för penningtvätt och så vidare. Här har EU gått före och reglerat krypto. Men krypto existerar på global nivå och därav behöver vi standarder på global nivå, så att vi kan dra nytta av potentialen, inte hämma den, och se till så att tekniken används på rätt sätt och inte används av suspekta nationer för att skada konsumenter och våra system som vi håller så kärt.

     
       

     

      Diego Solier (NI). – Señora presidente, señor comisario, el Reglamento MiCA, aunque presentado como un avance hacia la regulación de los criptoactivos, representa una amenaza directa a los derechos de los ciudadanos.

    Bajo el pretexto de proteger al consumidor y garantizar la estabilidad financiera, este marco podría socavar la privacidad, la libertad financiera y la innovación. Imponer estándares globales en un sistema creado para ser descentralizado es, literalmente, ponerle puertas al campo.

    Medidas como la recopilación masiva de datos personales, requisitos de capital inalcanzables para start-ups y la prohibición de ciertos criptoactivos no solo ahogan la innovación, sino que limitan la libertad de elección de los ciudadanos. Además, la vigilancia y la supervisión excesiva abren la puerta a un control digital sin precedentes.

    Mi pregunta es clara: ¿estamos regulando para proteger al ciudadano o para reforzar el control de los grandes poderes económicos y políticos sobre sus vidas? No podemos permitir que este Reglamento traicione la esencia de las criptomonedas: descentralización, autonomía y libertad.

     
       

     

      Andrey Kovatchev (PPE). – Madam President, Commissioner, dear colleagues, the European tech sector faces challenges that create a perception of stagnation compared to dynamic regions like South‑East Asia and the US. The EU is a global pioneer in the introduction of regulations such as the MiCA, with the aim to protect customers, but without hamper the growth. Yes, we need global standards, and the EU must be in the lead of this introduction. But also, we need to wake up.

    Talent migration is a big concern, with 90 % of the EU tech workers willing to relocate to the US for better salaries and funding opportunities. To reclaim the position of Europe, we need innovation‑friendly policies, including clear regulatory frameworks and sandbox environments for start-ups that will promote prosperity and growth.

    The rapid development of cryptocurrency markets highlights the urgent need to educate people on how to navigate the evolving landscape responsibly. Without proper knowledge, individuals and businesses risk falling victim to scams, fraud, financial crimes or malign global players. Europe needs to act now and act fast, if we are serious about our fostering competitiveness, and to act together with the responsible crypto community and not in a war with them.

    Are we ready to take bold decisions to ensure our success or will we risk again being left behind as others seize opportunities which we hesitate to explore? Commission and Council and colleagues, we need to act now.

     
       

     

      Waldemar Buda (ECR). – Doregulować, przeregulować i zabić. Taka jest regulacja i takie są działania Unii Europejskiej w wielu sprawach. Tak było z przedsiębiorcami, tak było z rolnikami. I teraz dokładnie tak samo podchodzimy do blockchain i kryptowalut. Za chwilę się okaże, że cały świat na tym zarabia, cały świat się rozwija, a my nie traktujemy tego jako szansy, tylko traktujemy to jako zagrożenie. Dzisiaj największe aktywa w kryptowalutach mają Chiny i Stany Zjednoczone, a Europa zastanawia się, jak to ograniczyć? Jak to zwalczyć? Za chwilę miliard osób na świecie będzie miało kryptowaluty.

    W Polsce 12% osób w wieku produkcyjnym ma już kryptowaluty. Ja się więc bardziej boję tego, że wy będziecie doregulowywać niż że nie będziecie robić nic, bo to pewnie zabije ten rynek i inni będą na tym zarabiać. Oczywiście nieprawidłowości trzeba ścigać, ale rozsądnie. Dzisiaj jak w Polsce się próbuje to uregulować, to lobbyści obsiedli urzędy i instytucje i ciężko cokolwiek zrobić. I ci, co mają na tym zarobić, i tak zarobią. A zwykli ludzie niestety nie mogą inwestować i się w tej sprawie rozwijać.

     
       

     

      Caterina Chinnici (PPE). – Signor Presidente, signor Commissario Brunner, onorevoli colleghi, “follow the money”: è questo il metodo per contrastare davvero la criminalità organizzata, come l’esperienza investigativa e giudiziaria italiana ci insegna da oltre quarant’anni. E “focus on the money” è oggi il motto della Procura europea nel solco di quell’insegnamento.

    Quando il denaro si fa virtuale, le sfide per le autorità di regolamentazione e di contrasto si complicano, mentre invece si moltiplicano le opportunità per le organizzazioni criminali: decentralizzazione, anonimato, bassa tracciabilità, scarsità di controlli, possibilità di effettuare rapidi trasferimenti di denaro transfrontalieri e di creare catene complesse di transazioni sono solo alcune delle ragioni che rendono criptovalute e blockchain strumenti sempre più utili per la criminalità organizzata transnazionale e per le organizzazioni terroristiche globali.

    In criptovalute si pagano i traffici di droga, armi ed esseri umani e, attraverso le operazioni che le criptovalute consentono, i capitali illeciti vengono riciclati e reinvestiti agevolmente nell’economia legale.

    Per questo, è necessario regolamentare il fenomeno. Certo, con il regolamento sui mercati delle cripto‑attività, le norme sui trasferimenti di cripto‑attività e le nuove norme su antiriciclaggio e confisca abbiamo iniziato a farlo, però l’Unione deve continuare a sostenere l’adozione di regole uniformi e standard globali, per impedire alle organizzazioni criminali di sfruttare a proprio vantaggio lacune e differenze normative, arginare il jurisdiction shopping e, così, contrastare davvero il crimine economico e finanziario.

     
       

     

      Seán Kelly (PPE). – Madam President, digital and cryptocurrencies present an important opportunity for Europe, provided we establish the necessary safeguards. We must strike the right balance between regulating to enhance consumer protection and promote financial stability, while ensuring we do not hinder innovation or impede the financial inclusion that cryptocurrencies can offer.

    The MiCA Regulation demonstrates Europe’s willingness to lead in establishing best-in-class regulatory frameworks. Recent events, such as the collapse of the FTX in November 2022, have shown why proper standards are essential to protect our citizens from irresponsible, and even fraudulent, market behaviour.

    However, the new Trump administration’s pro-crypto stance provides an opportunity for us to reflect. We hear from the crypto industry that the US is now becoming a more attractive jurisdiction than the EU, with its regulatory approach expected to be looser than ours. On this I make two points.

    One: here in Europe we must approach this industry with the same competitiveness lens we apply to all sectors. It is vital to monitor the impact of our regulations and remain adaptable enough to amend them if needed, ensuring we maintain the right balance.

    Two: those in the crypto industry eyeing Trump’s America with enthusiasm might reflect on the Trump coin debacle before this week’s inauguration. Be careful what you wish for!

    Ultimately, the cross-border and decentralised nature of cryptocurrencies demands international cooperation to address clear regulatory gaps, as was stated by the Commissioner and my colleague Markus Ferber. So let us collaborate closely with our global partners to establish clear and enforceable global standards.

     
       

       

    Catch-the-eye procedure

     
       

     

      Niels Geuking (PPE). – Frau Präsidentin, Herr Kommissar! Die ursprüngliche Idee von Kryptowährungen, ein globales und dezentrales Finanzsystem aufzubauen, hatte schon ihren Reiz und war leicht faszinierend, aber selbst der Bitcoin ist heute eine Riesenmogelpackung: 60 Prozent aller Bitcoins werden gerade mal von weniger als 18 000 Adressen verwahrt. Wo ist da der dezentrale Gedanke geblieben?

    Auf dem Kryptomarkt insgesamt herrscht dann auch eine Wildwest-Mentalität. Die Meme Coins sind Betrug mit Ansage. Vom Hawk Tuah Girl bis zum TrumpCoin – es mangelt schlicht und ergreifend überall an Substanz. Am Ende versucht dann jeder, jemand Dümmeren zu finden, der bereit ist, mehr zu bezahlen, als man selbst investiert hat. Es ist ein Spiel mit Verlierern und ein modernes Beispiel der Tulpenmanie, getrieben von Profitgier und Dummheit. 2021 sagte Trump selbst noch, Kryptowährungen seien eine potenzielle Katastrophe, gar Betrug – zumindest, bis er selbst einen Deal machen konnte. Weltweit durchsetzbare Regeln ohne die USA? Schwierig. Dabei braucht es sie, und zwar vor allem für die Technologie und den Fortschritt brauchen wir die globalen Standards. Zur Not …

    (Die Präsidentin entzieht dem Redner das Wort.)

     
       

     

      Maria Grapini (S&D). – Doamnă președintă, domnule comisar, de teama evaziunii nu trebuie să ne opunem inovației. Sigur, criptomonedele sunt rezultatul unei inovații. Ați spus foarte bine, avem regulament, avem directivă, ne gândim la standarde internaționale, pentru că da, nu suntem singuri pe lume, avem o piață globală.

    Problema este că, din punctul meu de vedere, nu trebuie să obstrucționăm cetățenii în a-și folosi veniturile, nu trebuie să obstrucționăm întreprinderile să investească așa cum doresc, ci trebuie să avem reguli pe care să le respecte.

    Ați spus, domnule comisar, între altele, că doriți să scoateți actorii dăunători. Trebuie să vedeți și cum, trebuie să spuneți ce măsuri, trebuie foarte multă transparență. Nu știu dacă aveți o statistică în Uniunea Europeană, în statele membre: Câte cazuri avem de evaziune, de înșelătorii prin criptomonede?

    Dar trebuie făcute aceste lucruri și cred că trebuie să rămânem cu această inovație – criptomonede – și în Uniunea Europeană, însă cu o reglementare și o supraveghere corectă.

    (Președinta a retras cuvântul vorbitoarei)

     
       

     

      Alexander Jungbluth (ESN). – Frau Präsidentin! Ich glaube, diese heutige Debatte hat wieder gezeigt, dass es unterschiedliche Menschenbilder gibt, die in diesem Parlament hier vertreten werden. Und eigentlich werden hier in diesem Haus immer Debatten darüber geführt, dass man Dinge regulieren muss, Dinge steuern muss. Freie Meinungen werden über den DSA eingeschränkt, und bei den Kryptowährungen ist es auch das Ziel, das möglichst an die kurze Leine zu legen.

    Ich glaube, wir sollten hier an dieser Stelle mal feststellen, dass unser Menschenbild ist, dass wir freie, mündige Bürger haben. Und freie, mündige Bürger sind auch in der Lage, sich eine freie Währung zu suchen. Und aus dem Grund, glaube ich, sind Kryptowährungen genau das Mittel, sich gegen staatliche Repressionen zu wehren, sich abzukoppeln von Staaten und einer Europäischen Union, die immer übergriffiger werden.

     
       


     

      Vytenis Povilas Andriukaitis (S&D). – Gerbiama pirmininke, komisare G. Braunai, labai malonu pasveikinti ir labai tikrai geras sumanymas ir teisinga linkme. Čia vienas kolega kalbėjo apie Dievo laiminimą, tai jam priminsiu, kad Dievas ne tik laimino, bet davė Dekalogą ir davė virš trijų šimtų įsakų ir įsakymų. Taigi, reguliavimas prasidėjo nuo Dievo. Tai visiems linkiu to nepamiršti. Toliau, antras dalykas, noriu atkreipti dėmesį – taip, godumas, spekuliacijos, pinigų plovimas, visos šitos bėdos yra didžiulės. Prisiminkite, kas atsitiko su finansų krize, kai griuvo didieji bankai. Tuomet su privačiais lėktuvais važiavo gelbėtis pas ką? Pas vyriausybes. Kai įvyko didžiulės krizės jau su kripto bankais vėl gi buvo tas pats. Todėl išties tie, kurie per daug kalbate apie laisvę, atminkit vieną, kai būna skaudžios pasekmės, tuomet ir tenka ieškoti pagalbos ne kitur, o valstybėse ir reguliuojamuose bankuose.

    (posėdžio pirmininkė iš kalbėtojo atima žodį)

     
       

     

      Diana Iovanovici Şoşoacă (NI). – Am văzut că vă deranjează foarte mult că Donald Trump și-a făcut propriul Bitcoin. Bravo lui! De ce nu faceți și dumneavoastră? Dumneavoastră sunteți cu băncile, băncile opresive! Ca avocat, am văzut cum băncile și-au bătut joc de clienții lor, i-au lăsat fără case, fără pământuri, fără nimic, oameni care s-au sinucis din cauza băncilor – cămătari legali.

    În acest context, bitcoinul – vreți și pe acesta să îl monopolizați, să îi faceți regulamente, oricum, extrem de proaste, pentru că niciodată nu o să puteți să garantați că o persoană sau o companie acționează cinstit, corect și profesional. În fapt, nicio companie nu poate acționa cinstit, corect și profesional din cauza impozitelor voastre.

    Mi-aduc aminte, statul român, ca să mă oprească, în „plandemie”, să mai lupt împotriva măștii și a vaccinării, mi-au blocat toate conturile și mi-au luat toți banii din bănci și mi-au dat 30 000 de euro amendă. Așa, ca să fiu controlată, să nu mai am cu ce să-mi cresc copiii. Bitcoinul este libertate și …

    (Președinta a retras cuvântul vorbitoarei)

     
       

       

    (End of catch-the-eye procedure)

     
       

     

      Magnus Brunner, Member of the Commission. – Madam President, ladies and gentlemen, what an interesting discussion and God bless Europe, I would say. I would like to conclude maybe this discussion by saying that we, of course, remain strong supporters of international standards for crypto. These represent a common set of principles around which jurisdictions around the world can converge.

    These standards ensure, at the end, an appropriate policy framework for crypto markets allowing innovation – yes, that is very important – to take place while ensuring that risks are appropriately mitigated. And with this EU MiCA Regulation all of you and most of you were talking about, Europe is the first major jurisdiction to achieve compliance also with international crypto standards.

    However, the Commission is well aware that our efforts alone, or even a partial international effort, cannot ensure that the risks posed by these global crypto markets are adequately addressed, and it is therefore crucial that the adoption of international crypto standards continues to grow.

    The US, that was mentioned as well as a key partner, of course, in promoting the adoption of international standards. We therefore do hope that the new administration will act as a catalyst for further progress in bringing regulatory clarity to crypto asset markets in the United States. And we would expect that any new policy and regulatory developments in the US fully, of course, reflect international standards.

    Thanks again for the discussion and for giving the Commission also the opportunity to participate in this very important exchange.

     
       


       

    (The sitting was suspended at 11:48)

     
       

       

    IN THE CHAIR: SABINE VERHEYEN
    Vice-President

     

    5. Resumption of the sitting

       

    (The sitting resumed at 11:59)

     

    6. Composition of new committees

     

      President. – Following the creation of the standing committees on security and defence and public health, and the special committees on the European Democracy Shield and on the housing crisis in the European Union, the political groups and the non-attached Members have notified the President of appointments to these new standing and special committees as of 23 January 2025.

    The list of the committees’ members will be published online and in the minutes.

     

    7. Composition of committees and delegations
























     

      President. – Sorry. We have clear rules on what are points of order. Some colleagues are very generous when there are actual accidents or things that are happening. But sorry, we have to stick to the points of order, because on Monday we have the one-minute speeches so you can make your position on special issues you want to raise.

    But we are here exactly for points of order. And that is what I exercise, clearly to the Rules. And there is no discussion about what has happened yesterday or the week after, or 20 weeks before or later. Sorry, we have clear order to rule it like it is.

    (Applause)

     

    8. Voting time

     

      President. – The next item is the vote.

     

    8.1. Case of Jean-Jacques Wondo in the Democratic Republic of the Congo (RC-B10-0069/2025, B10-0065/2025, B10-0069/2025, B10-0070/2025, B10-0072/2025, B10-0078/2025, B10-0081/2025, B10-0084/2025) (vote)

     

      President. – The first vote is on the joint motion for a resolution tabled by five groups on the case of Jean-Jacques Wondo in the Democratic Republic of the Congo (see minutes, item 8.1).

     

    8.2. Systematic repression of human rights in Iran, notably the cases of Pakhshan Azizi and Wrisha Moradi, and the taking of EU citizens as hostages (RC-B10-0066/2025, B10-0063/2025, B10-0066/2025, B10-0067/2025, B10-0073/2025, B10-0082/2025, B10-0085/2025, B10-0086/2025) (vote)

     

      President. – The next vote is on the joint motion for a resolution tabled by five groups on the systematic repression of human rights in Iran, notably the cases of Pakhshan Azizi and Wrisha Moradi, and the taking of EU citizens as hostages (see minutes, item 8.2).

     

    8.3. Case of Boualem Sansal in Algeria (RC-B10-0087/2025, B10-0087/2025, B10-0088/2025, B10-0089/2025, B10-0090/2025, B10-0091/2025, B10-0092/2025, B10-0093/2025) (vote)

     

      President. – The next vote is on the joint motion for a resolution tabled by five groups on the case of Boualem Sansal in Algeria (see minutes, item 8.3).

     

    8.4. Russia’s disinformation and historical falsification to justify its war of aggression against Ukraine (RC-B10-0074/2025, B10-0074/2025, B10-0075/2025, B10-0076/2025, B10-0077/2025, B10-0079/2025) (vote)

     

      President. – The next vote is on the joint motion for a resolution tabled by five groups on Russia’s disinformation and historical falsification to justify its war of aggression against Ukraine (see minutes, item 8.4).

     

    9. Resumption of the sitting

       

    (Sēde tika atsākta plkst. 15:00.)

     

    10. Approval of the minutes of the previous sitting

     

      Priekšsēdētājs. – Ir pieejams vakardienas sēdes protokols un pieņemtie teksti. Vai ir kādas piezīmes? Protokols ir apstiprināts.

     

    11. Major interpellations (debate)

     

      Priekšsēdētājs. – Nākamais darba kārtības punkts ir debates par plašu interpelāciju, uz kuru jāatbild rakstiski un kurai seko debates, un kuru ECR vārdā iesniedza Charlie Weimers, Sebastian Tynkkynen, Kristoffer Storm, Jaak Madison, Carlo Fidanza, Adam Bielan, Alexandr Vondra, Patryk Jaki, Johan Van Overtveldt, Roberts Zīle, Emmanouil Fragkos, Georgiana Teodorescu, Geadis Geadi, Marion Maréchal, Ivaylo Valchev, Kosma Złotowski, Mariusz Kamiński, Maciej Wąsik, Dick Erixon, Joachim Stanisław Brudziński, Beatrice Timgren, Nicolas Bay, Jadwiga Wiśniewska, Ondřej Krutílek, Guillaume Peltier, Michał Dworczyk, Laurence Trochu, Şerban-Dimitrie Sturdza, Tobiasz Bocheński un Gheorghe Piperea Komisijai par ES finansējumu fiziskiem robežu aizsardzības elementiem, piemēram, sienām, žogiem vai citām barjerām, pie ES ārējām robežām (G-001002/2024).

     
       

     

      Jaak Madison, author. – Mr President, first of all, we are pretty many Members here on the last day of the week.

    First of all, in September, on September 20, 30 Members of the Parliament, so pretty many, have addressed written questions to the Commission. Unfortunately, we haven’t got any answer in six weeks. So, c’est la vie, and the result is that we have to discuss the question here.

    And I’m even more happy that on this very important topic, we can ask directly from the new Commissioner from Austria, who understands probably very well about the consequences of the illegal migration, about security, about the defence questions.

    The question was about the EU funds and is there any kind of consideration in the European Commission to finance also the projects to protect our external borders physically? For example, in February 2023, the European Council implored the Commission to immediately mobilise substantial EU funds and means in order to help countries bolster their border protection capabilities and infrastructure.

    Commission President von der Leyen has said that the EU will act to strengthen our external borders, specifically by providing an integrated package of mobile and stationary infrastructure from cars to cameras, from watchtowers to electronic surveillance.

    Unfortunately, we understand very well that it’s not enough to fight against, for example, the hybrid attacks by Russia, where they are using thousands of people as a weapon against Finland, against Poland, Lithuania, maybe next day to Estonia. And if those people are used by Russia’s hybrid attack, how can we stop to move them to Germany, to Austria, to the inside of the European Union, thanks to the Schengen free movement that we have?.

    That is why we had only two concrete questions: why has the Commission not yet recognised the reality on the ground at the EU’s external borders and moved to lift its anachronistic moratorium on EU funding for physical border barriers?

    And secondly, considering the ongoing hostile activities at the eastern border and the Member States have taken to constructing border barriers to counter the instrumentation of migrants, will the Commission change its approach and support Member States’ external border barrier projects financially via the EU budget?

     
       

     

      Magnus Brunner, Member of the Commission. – Mr President, honourable Members, thank you, first of all, for bringing this very important topic to the agenda this afternoon. Let me start by saying that I fully agree with the imperative of reinforced management of our external borders. It must be, of course, us and not the smugglers who decide who comes to our European Union and under what circumstances. This is all the more imperative given precisely the hybrid threats you mentioned. Our response must be as united as it is resolute.

    Coming from a ministry of finance for the last three years, allow me to start my intervention with some figures. In 2024, we saw a 38 % drop in irregular arrivals compared with the previous year. So it’s 239 000 compared with 386 000. And this includes a sharp 78 % drop on the Western Balkan route and 59 % fall on the central Mediterranean route. And that’s stated, as you mentioned, by President von der Leyen in her latest letter also to the European Council. This is the result of the EU’s active engagement with our partner countries, and it is working. We see that and we must continue to pursue these efforts.

    But, as you rightly mentioned, in parallel, we are very much aware that some regions are still under pressure, of course. In particular, there was a threefold increase in irregular crossings at the eastern border, in part as a result, as you mentioned, of the instrumentalisation of migrants by Russia and Belarus in their attempt to destabilise the European Union and undermine also our security. As a response, last month, the Commission issued a communication on countering hybrid threats from the weaponisation of migration and also strengthening security at the EU’s external borders. The Commission recognised that Member States can take proportionate, on the one hand, and also temporary measures to address the threat posed by both Russia and Belarus.

    Member States have the responsibility, of course, also to maintain law and order and safeguard national security. That’s pretty obvious. But they do so with the support of the European Union and also its budget on a European Union level. Those Member States bordering Russia and Belarus have recently received additional funding of EUR 170 million to enhance border surveillance altogether.

    This is just part of the broader picture of EU budgetary support to border management. All EU funding for border management has more than tripled over the past three multiannual financial frameworks (the famous MFF), with up to 7.7 billion allocated for border management and also visa instrument in the current 2021 to 2027 period. With these funds, the European Union is building one of the most advanced border management systems in the world and the largest share of this amount – that’s EUR 4.3 billion – is allocated directly to Member States under their national programmes.

    Also the EU’s decentralised agencies – Frontex, eu-LISA, the EUAA, of course, the asylum agency – they also play a key role when it comes to border management, and their budget for the current period amounts to EUR 9.8 billion. In the future, the strengthening of Frontex with increased operational capabilities, including a tripling of its standing corps, will also further contribute to supporting the Member States – because that’s what Frontex is here for – in addressing the challenges at the external borders.

    I would therefore argue that not only has the Commission recognised the reality on the ground, but it is actively also supporting enhanced border management with substantial means, actually. I would also underline that this remains a key priority for me and for the Commission in general. And we are committed to continuing to strengthen the EU’s external borders and supporting the Member States, of course, both operationally and financially, to boost border surveillance.

    I am also very keenly aware, however, that budgets are limited, and the EU budget, of course, is no exception here. It is essential to make the most of every single euro, channelling it to where it is most effective at the end of the day and has the biggest impact, of course. Given these considerations, the Commission has so far focused funding, where the needs are the most urgent and where European money can have a real added value. This has included financing for mobile and stationary units, for border surveillance systems and equipment, for refurbishment of border crossing points, new installations for IT systems, plus also, of course, the maintenance of the equipment. All this increases situational awareness on border control capabilities, which are, of course, crucial for effective border protection, combined, as I said before, with continued support and also continued deployment by Frontex.

    That is the picture of today: EU funding is available to Member States to provide well‑equipped and also modern infrastructure for a very high level of security at the European external borders and to help also combat irregular migration. These things must go hand in hand. On top of this, Member States can decide, of course, themselves to finance structures such as fences, for instance, themselves, while always ensuring, of course, respect for fundamental rights.

    Now, the next step – and this is very important what I’m going to say now – going forward, Mr Madison, and following the trend also observed in the last years, it is clear that the overall needs for border management must be reassessed as part of the preparation of the next multiannual financial framework. This process is currently underway and should of course not be pre-empted. We will, of course, take into account the border management needs we have for the next months and years to come, which must be considered in a holistic manner for the different needs, priorities and resources available, whilst always ensuring that measures are, of course, proportionate and also respect fundamental rights.

    The views of the European Parliament in preparation of that process are, of course, incredibly important. At the same time, constant engagement is necessary to achieve results on external border management, and the European Union will continue to deepen these comprehensive and strategic relations that it is building with key countries of origin, but also key countries of transit, including migration in the spectrum of key interests covered by these agreements.

     
       

     

      Lena Düpont, on behalf of the PPE Group. – Mr President, Commissioner, I’d like to address the topic of today on two levels: on a procedural one and on a content one.

    On the procedure, as a representative of this House, of course, I also need to underline the request towards the Commission to respect the timelines and, of course, to adhere to the timelines. There’s a reason why we set timelines for the answering of the questions, and I think that we can do more actually also to work together to come closer again in that sense.

    On content, as it is mainly about instrumentalism – where, by the way, the ECR had the rapporteurship in the previous term – I think the question here at stake does not necessarily reflect the dynamic in the policy field. The Commission, the Commission President, they are in close debate with the Member States concerned. There are proposals on the table, both with financial support and additional money, but also in the adaptation of the policy response.

    As a general remark, Europe is the strongest when we act together and we, as the EPP, will make sure to do so further down the road. And while I say that some here in the House need to accept that there is a thing such instrumentalism – that it is part of hybrid attacks, and it needs to be seen in the geopolitical context – other parts here in the House also need to accept that as well, because the very same reason why we are speaking about this cynical, state-sponsored and state-accepted smuggling business is Moscow and Minsk attacking – trying to pressure – the European Union.

    So at least actors, some here in the House, want to align closer with. I would call that cognitive dissonance, but solve that out on your own. Rest assured that we, as the EPP, will go forward working on a common solution as a European Union that is strong and proud of its roots and values.

     
       

     

      Ana Catarina Mendes, em nome do Grupo S&D. – Senhor Presidente, Senhor Comissário, Caros Colegas, fiquei muito preocupada com o final da sua intervenção, Senhor Comissário, permita-me partilhar isto consigo.

    Em 2021, quando se aumentou a verba para o Fundo de Gestão Integrada das Fronteiras, a Senhora Presidente da Comissão afirmou — e cito — «a União Europeia não financiará nem muros, nem arame, nem cercas». O Senhor Comissário terminou a sua intervenção a dizer: «vamos aumentar o financiamento para as cercas».

    E queria dizer-lhe, em nome dos Socialistas e Democratas, que estamos totalmente de acordo que é preciso gerir as nossas fronteiras, mas gerir as nossas fronteiras não significa violação dos direitos humanos, como temos assistido frequentemente.

    Por isso, as verbas que foram atribuídas — mais verbas —, para as fronteiras, para este fundo, não podem ser para as câmaras de vigilância, para as cercas, para os muros, porque isso é ao arrepio daquilo que tem sido a política de migrações da União Europeia ao longo dos anos.

    E, por isso, Senhor Comissário, aquilo que lhe queria dizer é que tenha em conta os dados que aqui referiu, que eu, ontem, referi na minha outra intervenção, e que são verdade: em 2024, houve um decréscimo da imigração irregular em 38 %.

    Isso significa, Senhor Comissário, que nós temos de continuar a estar atentos à implementação do Pacto das Migrações e ter uma visão humanista daquilo que é a imigração. Nós não vamos parar a imigração com a mão, como não paramos o vento com as mãos, é impossível. Os fluxos migratórios existem desde sempre.

    A Frontex tem sido, muitas vezes, acusada de violar direitos fundamentais e, recentemente, a plataforma para a cooperação sobre cidadãos não documentados alertou para a violação sistemática, nas fronteiras, dos direitos humanos destes cidadãos, por isso, aquilo que lhe peço é que continue a ser o guardião dos tratados e a tratar as pessoas com dignidade.

     
       

     

      András László, on behalf of the PfE Group. – Mr President, EU countries want border walls and other barriers against illegal immigration, and the EU should pay for it. The majority of European leaders demanded that the European Commission immediately mobilise substantial funding for this. This was two years ago and Ursula von der Leyen did nothing.

    What did the Commission do instead? They sued Hungary for defending the EU’s external borders. For not allowing illegal entry into the EU, Hungary received a EUR 200 million fine. In addition, they demand that we pay a fine of EUR 1 million for each and every day that we refuse to give up our efforts to keep illegal migrants out of the EU.

    European citizens don’t want a Christmas like in Magdeburg. They don’t want a New Year’s Eve like in Brussels or Cologne. Europeans want tough border protection on the outer borders of the European Union. The radical ideology of Brussels elites about open borders is a failure. It goes against the will of EU governments, it goes against the will of European citizens and it goes against common sense.

    Ultimately, European citizens pay the highest price for it. In 10 years, Hungary has already spent EUR 2 billion to defend the EU’s borders on the south. In the east, several countries are now spending vast resources to keep illegal immigrants out.

    Pay for the fence in Hungary; pay for the fence in Finland; pay for the fence in Poland and all other countries that defend our external borders. This was the demand of the European governments so that European citizens won’t have to pay with their blood.

     
       

     

      Joachim Stanisław Brudziński, w imieniu grupy ECR. – Panie Przewodniczący! Szanowni Państwo, od czerwca 2021 roku Polska, Łotwa i Litwa doświadczają kryzysu na swojej granicy z Białorusią, gdzie dziesiątki tysięcy migrantów i osób ubiegających się o azyl, głównie z Afryki i Bliskiego Wschodu, próbowały przedostać się i próbują przedostać się do Unii Europejskiej przy wsparciu władz białoruskich. Od 2023 roku dołączyła tutaj również Finlandia. Już bezpośrednio Rosja, bez pomocy swojego pomocnika, jakim jest Łukaszenka, tak samo próbuje wepchnąć na terytorium Unii Europejskiej nielegalnych imigrantów.

    Tymczasem nowe rozporządzenie kryzysowe, które jest częścią Paktu o Azylu i Migracji, odnosi się do problemu instrumentalizacji migracji jedynie z perspektywy prawa azylowego i jedynie poprzez zapewnienie bardzo ograniczonego katalogu odstępstw od obowiązujących przepisów, które mają być stosowane przez państwa członkowskie zaatakowane w ten hybrydowy sposób. Oczekujemy jednak, jako Europejczycy od Unii Europejskiej bardziej asertywnych rozwiązań, skupiających się przede wszystkim na bezpieczeństwie obywateli Unii Europejskiej. Rozwiązania takie powinny obejmować wzmocnienie infrastruktury granicznej, budowę barier fizycznych i modernizację systemu granic, współpracę organów ścigania i odpowiednie wsparcie Europolu i Frontexu z wykorzystaniem również narzędzi współpracy międzynarodowej, w tym skutecznej współpracy z państwami trzecimi w zakresie powrotów i umów o readmisji.

    Szanowni Państwo, chciałbym przypomnieć też o sytuacji, która miała miejsce, kiedy ta hybrydowa wojna Putina się rozpoczęła. Byliśmy świadkami w tej Izbie festiwalu hipokryzji i wystąpień zgoła kabaretowych. Przedstawiciele nie tylko lewicy, ale również PPE atakowali w sposób grubiański i skrajnie niemądry ówczesny rząd polski, rząd Prawa i Sprawiedliwości za budowę muru na granicy polsko- białoruskiej i za ochronę granicy zewnętrznej Unii Europejskiej. Ba, nawet został zdymisjonowany ówczesny szef Frontexu, za to tylko, że wsparł ówczesne działania rządu polskiego. Nie kto inny, jak ówczesny lider PPE, sam Donald Tusk, grzmiał, że migranci zwiezieni przez Łukaszenkę to biedni ludzie, których należy wpuścić, bo przybywają oni tutaj w poszukiwaniu lepszego życia.

    Europosłowie Platformy Obywatelskiej, którzy dzisiaj zasiadają w tej Izbie, pajacowali na granicy, atakując werbalnie funkcjonariuszy polskiej Straży Granicznej, policji czy wojska. A dzisiaj jesteśmy świadkami cudu. Nie kto inny, a ten sam Donald Tusk wczoraj z tego miejsca mówi, że najważniejsze jest bezpieczeństwo i wzywa do ochrony granic zewnętrznych.

    Szanowni Państwo, jego kolega, pan Max Weber z tego miejsca gratuluje Tuskowi odsunięcie Prawa i Sprawiedliwości od władzy i wysyła premiera Jarosława Kaczyńskiego na emeryturę. Panie Weber, gdyby nie premier Jarosław Kaczyński, którego siła i wola polityczna powstrzymała ten nielegalny proceder, to te setki tysięcy migrantów miałby Pan dzisiaj w Berlinie, w Monachium i w innych miastach niemieckich. Jeżeli ktoś ma iść na emeryturę to Pan, Ursula von der Leyen i zabierzcie Tuska, dzięki Wam ma już wysoką emeryturę europejską.

     
       

     

      Fabienne Keller, au nom du groupe Renew. – Monsieur le Président, cher Roberts Zīle, Monsieur le Commissaire Magnus Brunner, nous avons eu ce débat de très nombreuses fois et, en dépit d’arguments logiques, factuels, et de statistiques démontrant que construire des murs aux frontières non seulement ne marche pas, mais que ce n’est pas non plus dans notre ADN européen, nous y voilà encore.

    Contrairement à ce qu’aime prétendre l’extrême droite, il ne suffit pas de construire des murs à nos frontières pour régler la question de l’immigration illégale. Bien sûr que nous devons protéger nos frontières, nous organiser pour les faire respecter, comme vous l’avez expliqué, Monsieur le Commissaire; nous nous y employons. Mais la meilleure gestion de la migration et la meilleure protection de nos frontières, elle passe aussi par l’application de ce pacte, qui n’est pas encore en œuvre. En effet, un volet majeur de la mise en œuvre du pacte est consacré à cette protection des frontières.

    Cela passe par la création de procédures accélérées aux frontières, d’un filtrage rigoureux, d’une base de données sur l’asile et la migration et de moyens budgétaires supplémentaires. Le pacte comprend également un volet de coopération avec les États tiers afin de prévenir les départs irréguliers, de lutter contre le trafic des migrants, de coopérer en matière de réadmission et de promouvoir des voies d’accès légales. Ce sont ces mesures novatrices que nous devons financer avec le budget européen.

    Ce budget doit être utilisé pour rassembler. Il doit être mis au service des citoyens et de la solidarité. Le budget européen, chers collègues, doit construire des ponts, pas des murs.

     
       

     

      Mélissa Camara, au nom du groupe Verts/ALE. – Monsieur le Président, Monsieur le Commissaire, chers collègues, barrières, barbelés, divisions. Là est l’obsession d’une partie de la classe politique européenne. Partout où des États ont dressé des murs, ils n’ont semé que souffrance et désespoir. Aujourd’hui, une soixantaine de murs parsèment le globe de cicatrices de béton. Depuis une vingtaine d’années, les barrières physiques se multiplient aux frontières de l’Union européenne, en Hongrie, en Espagne, en Grèce, en Bulgarie. Ce sont désormais 13 % des frontières terrestres de l’Union européenne qui sont clôturées.

    Les murs, donc, comme seule perspective politique, partout. Regardez ce mur entre les États-Unis et le Mexique érigé sous Bush, toujours plus haut sous Trump, plus de 1 000 kilomètres d’acier et de méfiance. Ce mur que, chaque année, des centaines de milliers de personnes cherchent à franchir, poussées par l’espoir d’une vie meilleure. Et ici, en Europe, c’est la même histoire. Ceuta et Melilla, par exemple. Une porte close, des regards détournés. Ces barrières ne résolvent rien. Elles brisent des vies, elles éteignent les rêves et tuent. Souvenons-nous du 24 juin 2022 à Melilla: le gaz lacrymogène, les balles en caoutchouc, des migrants piégés entre les clôtures, blessés, abandonnés, sans soins… 23 vies fauchées. Et combien d’autres en Europe?

    Les murs n’arrêtent pas les pas. Ils allongent les routes. Ils poussent les exilés vers des chemins plus périlleux où l’ombre de la traite les guette. Les murs ne stoppent pas non plus les catastrophes humanitaires et climatiques, les guerres, les persécutions qui ont lieu partout dans le monde. Je l’ai dit hier dans une autre intervention et je souhaite le rappeler aujourd’hui: personne ne quitte son pays, ses repères, sa famille et ses proches par choix. Les murs ne protègent pas, ils séparent, ils creusent des fossés entre les peuples. Ils nourrissent la peur et la haine.

    Puisque les murs ne suffisent pas, désormais, des caméras, des drones de surveillance et tout un arsenal numérique sont déployés aux frontières de l’Europe. Mais les gens continueront d’essayer. Leur permettre de franchir les frontières n’est ici qu’une question d’humanité et de solidarité.

    Cette Europe forteresse n’est pas la mienne. Mon Europe est celle d’un accueil digne et inconditionnel, celle des droits humains et de l’égalité. Jamais nous n’accepterons la surenchère des moyens sécuritaires contre les personnes exilées, comme la droite et l’extrême droite de ce Parlement le réclament. Des milliards qui partent en fumée chaque année, pour quelle protection? Pour quel résultat, sinon la mort et le désespoir? Cessons enfin l’apathie morale. L’Europe doit choisir l’humanité, la solidarité, les ponts et refuser les murs.

     
       

     

      Christine Anderson, im Namen der ESN-Fraktion. – Herr Präsident! Europa wird angegriffen – nicht durch Panzer oder Raketen, sondern durch den Migrantenansturm auf unsere Grenzen, der als Waffe gegen uns eingesetzt wird. Und das funktioniert, weil wir uns von linken Spinnern haben einreden lassen, Pushbacks seien illegal. Pushbacks – also das konsequente Zurückweisen von Migranten an den Grenzen – sind aber das effektivste Mittel, um illegale Grenzübertritte zu verhindern und diesen Angriff auf unsere Heimatländer abzuwehren.

    Dass wir sie nicht nutzen dürfen, verdanken wir einer massiven Lobbyarbeit von Pro-Migrations-NGOs, finanziert von exzentrischen Milliardären, die sich als moralische Instanz aufspielen. Tatsächlich aber gefährdet deren Agenda nicht nur die Sicherheit Europas, sondern Europa an sich. Jedes souveräne Land hat das Recht, ja, die Pflicht, seine Grenzen zu schützen. Die Behauptung, dass dies rechtswidrig sei, ist eine dreiste Lüge, die Europa jeder Möglichkeit der Selbstverteidigung beraubt.

    Und natürlich brauchen wir physische Barrieren an den Außengrenzen – sie wirken, sie schützen, sind legal und legitim. Diese Zäune und Mauern sind nichts anderes als ein in Stacheldraht und Beton gegossener Pushback. Also bauen wir sie endlich, diese physischen Barrieren, und schützen wir endlich unsere Heimatländer und unsere Bürger.

    Auch Sie, Herr Kommissar Brunner, sollten doch inzwischen zur Kenntnis genommen haben, dass die politische Landschaft im Wandel ist. Ihre christdemokratische Partei wird bald Juniorpartner der FPÖ sein. Sie werden Ihren Kurs ohnehin ändern müssen. Warum nicht jetzt? Und wenn nicht jetzt, wann dann?

    Aber die nächsten Wahlen werden ohnehin zeigen, dass die Bürger keine Parteien mehr wählen werden, die sich weigern, die Grenzen zu schützen. Sie werden keine Parteien mehr wählen, die die Sicherheit der eigenen Bürger auf dem Altar imaginärer Rechte und Ansprüche von Millionen von rückständigen Masseninvasoren opfern und – mehr noch – sie ihnen erbarmungslos zum Fraß vorwerfen.

    Kommen Sie endlich zur Besinnung. Handeln Sie – und zwar entschieden und jetzt!

     
       


     

      Murielle Laurent (S&D). – Monsieur le Président, Monsieur le Commissaire, chers collègues, «structures physiques de protection des frontières», il s’agit là du titre de ce débat. Ce n’est en réalité que du verbiage politiquement correct pour parler de murs, de barrières, de barbelés. Cette sémantique nous renvoie à une période bien sombre de notre histoire.

    La Communauté européenne a été bâtie sur un idéal de paix, d’union et d’ouverture. Notre but n’est pas d’ériger des murs, mais de les faire tomber, comme ce fut le cas le 9 novembre 1989 avec la chute du mur de Berlin. Financer de telles infrastructures serait une insulte à la construction européenne. Plutôt que de construire des murs, nous devrions consacrer notre budget à défendre la démocratie, menacée par les populistes et non par les migrants. Comme je l’ai dit hier, ici même, lors du débat sur les liens entre la criminalité et la migration: il n’y a qu’en assumant une migration positive, en mettant en place des voies légales de migration et en engageant des partenariats sérieux avec les autres pays que nous pourrons y parvenir. Non, ce ne sont pas des idioties, c’est du bon sens. Le respect des droits fondamentaux, c’est du bon sens.

     
       

     

      France Jamet (PfE). – Monsieur le Président, 30 000 personnes. 30 000 personnes sont mortes en tentant de traverser la Méditerranée, à la poursuite d’un eldorado fictif, à la poursuite d’un eldorado que vous leur avez vendu. Ces morts tragiques, elles ne sont pas à mettre sur le compte de la lutte contre l’immigration illégale, mais sur celui de votre idéologie sans-frontiériste, des pompes aspirantes que vous avez mises en place et de votre mansuétude vis-à-vis des réseaux mafieux de passeurs. On voit d’ailleurs à Mayotte, sur notre sol, aujourd’hui, le résultat de cette politique du laissez-faire.

    Alors c’est vrai, construire des infrastructures pour stopper cette pression migratoire, qui pèse sur nos comptes publics, notre économie et la sécurité de nos compatriotes, ne sera pas suffisant sans un arsenal juridique et la volonté politique. Pour cela, il faut d’abord avoir le courage de dire: «Sachez que si vous entrez illégalement sur notre territoire, ce sera l’expulsion et le retour.»

     
       


       

    Brīvais mikrofons

     
       


     

      Bogdan Rzońca (ECR). – Panie Przewodniczący! Chciałem zabrać głos, żeby oddać hołd 21 letniemu Mateuszowi Sitkowi. Polski żołnierz, 21 letni żołnierz, został zabity przez bandytów na granicy polsko-białoruskiej. Zabity, zamordowany. I chcę o tym tu powiedzieć, bo wtedy, kiedy my, Polacy, broniliśmy granicy Unii Europejskiej, kiedy Putin i Łukaszenka wpychał uchodźców do Polski, prowadząc wojnę hybrydową, wy świetnie tu bawiliście się w Parlamencie Europejskim na fałszywym filmie polskiej reżyserki, która ośmieszała polską policję, polskich żołnierzy, tych wszystkich, którzy bronili granicy Unii Europejskiej.

    Musicie się za to wstydzić. Będę wam o tym zawsze przypominał, dlatego że dzisiaj oczywiście ta debata jest ważna, cieszę się, że komisarz przyjął takie, a nie inne stanowisko, ale wołaliśmy o te pieniądze na granicy, o to bezpieczeństwo w poprzednich latach i się nie udawało. A wczoraj oklaskiwaliście Donalda Tuska, który tutaj, w Brukseli, powiedział tak: To, co robi polski rząd Prawa i Sprawiedliwości, to szpetna propaganda. A myśmy po prostu zwyczajnie bronili granicy Unii Europejskiej. (przewodniczący odebrał mówcy głos)

    (Przewodniczący przerwał mówcy)

     
       

     

      Siegbert Frank Droese (ESN). – Herr Präsident! Ich hatte selber die Gelegenheit, als Bundestagsabgeordneter die litauische Außengrenze, die bulgarische Außengrenze zu besuchen, und es gab immer Kritik an den Finanzierungsmöglichkeiten durch die EU, dass eben zu viel humanitäre Maßnahmen gefördert wurden, aber kein robuster Grenzschutz. Insofern sind die Ausführungen von Politkommissar Brunner ein kleiner Fortschritt.

    Alleine mir fehlt der Glaube an den Willen. Wir brauchen den Willen zur Festung Europa. Wir brauchen einen, wenn Sie so wollen, neuen Eisernen Vorhang an den Außengrenzen Europas. Aber wir brauchen auch im Inneren Europas Ordnung. Wir werden daher nicht umhin kommen, Millionen von Straftätern und illegalen Migranten auszuweisen. Also wir brauchen millionenfache Remigration innerhalb Europas.

    Und das ist leider in Ihren Worten, Herr Politkommissar Brunner, überhaupt nicht vorgekommen. Solange dieses Thema nicht zentral als Aufgabe von Ihnen angesehen wird, kann ich leider Ihren schönen Worten keinen Glauben schenken.

     
       

       

    (Brīvā mikrofona uzstāšanos beigas.)

     
       

     

      Magnus Brunner, Member of the Commission. – Mr President, ladies and gentlemen, honourable Members, thank you very much, first of all, for your interventions.

    Border protection, I think we all agree, is a shared responsibility. We know the dimension of the challenge, definitely. And we will continue to dedicate also massive resources to meet it in cooperation, of course, with national authorities, with the EU agencies dealing with the topic, and with partner countries of origin and also of transit, as I said in my former statement.

    EU funds will have a strong role to play in this, and the preparation of the next MFF will be the moment to reassess the needs for border management and how these can be better addressed, whilst always ensuring – and this is also very important – that measures are proportionate and of course respect fundamental rights.

    I stand ready to engage with you on this in the weeks to come. I think that is very important. And I stand, of course, also ready to listen to you all.

     
       

     

      President. – Thank you very much, Commissioner.

    The debate is closed.

     

    12. Explanations of votes

     

      Priekšsēdētājs. – Nākamais darba kārtības punkts bija paredzēts balsojumu skaidrojumi, bet tā kā neviens balsojuma skaidrojums nav saņemts, tad pāreju pie šīs sēdes nobeiguma.

     

    13. Approval of the minutes of the sitting and forwarding of texts adopted

     

      Priekšsēdētājs. – Šīs sēdes protokols tiks iesniegts Parlamentam apstiprināšanai nākamās sēdes sākumā.

    Ja nav iebildumu, šodienas sēdē pieņemtās rezolūcijas nosūtīšu tajās norādītajām personām un struktūrām.

     

    14. Dates of forthcoming sittings

     

      Priekšsēdētājs. – Nākamā sesija notiks 2025. gada 29. janvārī Briselē.

     

    15. Closure of the sitting

       

    (Sēde tika slēgta plkst. 15:41.)

     

    16. Adjournment of the session

     

      Priekšsēdētājs. – Eiropas Parlamenta sesiju pasludinu par pārtrauktu.

     

    MIL OSI Europe News

  • MIL-OSI Security: Federal Jury Convicts Former OSBI Investigator Of Sexual Abuse Of A Minor

    Source: Office of United States Attorneys

    MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced today that Jordan Francis Toyne, 36, of Broken Arrow, Oklahoma, was found guilty by a federal jury of three counts of Sexual Abuse of a Minor in Indian Country.

    The jury trial began with testimony on January 21, 2025, and concluded on January 23, 2025, with the guilty verdicts.

    During the trial, the United States presented evidence that Toyne sexually assaulted a minor over a period of time beginning in the Summer of 2020 until 2023, when the victim reached 16 years of age.  The United States also presented evidence that Toyne sexually abused another minor in 2021.

    At the time of the assaults, Toyne served as an investigator with the Oklahoma State Bureau of Investigation’s Internet Crimes Against Children (ICAC) unit.  Toyne resigned from his post prior to the completion of an internal investigation conducted by the OSBI.  The victims were unrelated to Toyne’s official duties with the OSBI.  However, the United States presented evidence Toyne used his specialized knowledge as a Child Crimes Investigator to groom the victims and evade detection of his crimes.

    The guilty verdicts were the result of an investigation by the Federal Bureau of Investigation and the Owasso Police Department, together with cooperation and special assistance from OSBI.

    The United States Attorney’s Office for the Eastern District of Oklahoma prosecuted the case because the victim is a member of a federally recognized Indian tribe and the crimes occurred in Pittsburg County, within the boundaries of the Choctaw Nation Reservation of Oklahoma, in the Eastern District of Oklahoma.

    The Honorable Ronald A. White, Chief U.S. District Judge in the United States District Court for the Eastern District of Oklahoma, presided over the trial and ordered the completion of a presentence report.  The sentencing will be scheduled following completion of the report.  The defendant was remanded to the custody of the United States Marshals pending sentencing.

    Assistant U.S. Attorneys Nicole Paladino and Emily Wittlinger represented the United States.

    MIL Security OSI

  • MIL-OSI Security: Five Defendants Sentenced in Options Trading Scheme

    Source: Office of United States Attorneys

    ATLANTA – Milan Patel has been sentenced to prison in connection with a years-long market manipulation scheme in which he and his co-conspirators conceived, drafted, and disseminated false rumors about publicly traded companies and then profitably traded on these rumors by purchasing and selling mainly short-term call options.

    “The defendants used their financial acumen to manipulate the securities markets by releasing false information about publicly traded companies,” said Acting U.S. Attorney Richard S. Moultrie, Jr. “Our Office is committed to working with our law enforcement partners to investigate and prosecute all forms of securities fraud.”

    “These sentencings should serve as a reminder to anyone attempting to tilt the balance of financial markets in their direction using insider trading, investigating this illegal behavior is a top priority of the FBI and you will be held accountable,” said Sean Burke, Acting Special Agent in Charge of FBI Atlanta.

    According to Acting U.S. Attorney Moultrie, the charges and other information presented in court: Between approximately October 2017 and January 2020, Milan Patel, Bart Ross, Mark Melnick, Anthony Salandra, and Charles Parrino conspired to trade securities—primarily short-term call options—in large, publicly traded companies based on materially false rumors about those companies that they generated and disseminated. These materially false rumors were intended to increase the price of the securities (both the underlying stock and options).

    Call options are essentially a contract that gives the options’ holder the right, but not the obligation, to buy shares of the underlying stock at a set price per share—the option’s strike price—on or before a set future date (the option’s expiration date). Generally, the holder of a call option benefits when the price of the underlying stock increases. Short-term call options are ones that generally expire within a week.

    Ross, Salandra, and Parrino, were formerly registered brokers with the Financial Industry Regulatory Authority (FINRA) and were responsible for drafting some of the fraudulent rumors. The conspirators would often refine a proposed rumor by exchanging drafts among themselves using the Trillian instant messaging application.

    Melnick was a day trader and T3 Live Senior Trading Strategist who often provided technical evaluations on whether a particular false rumor would be successful. These rumors were carefully crafted to: (a) appear plausible enough to other market participants to move the price of the underlying security; and (b) move the price of the security in a particular direction—namely move the stock or option price up—so that Patel and the other conspirators could profitably trade on the rumors.

    Patel was responsible for disseminating the rumor via Trillian to multiple accounts, which would in turn result in the false rumor being distributed over one or more market subscription services, including Trade The News, TradeXchange, and Benzinga, as well as various Twitter accounts.

    Before Patel disseminated the rumor, the co-conspirators would acquire a position in the publicly traded company that was the subject of the rumor. The co-conspirators purchased short-term call options often mere seconds before Patel disseminated the rumor. The conspirators often purchased short-term call options because the price of such options is more sensitive than the price of the underlying stock. The conspirators profited from their scheme by selling the options (or other securities) after they increased in price. They would then sell off their positions shortly after the rumor was disseminated and the price of the option or underlying stock had increased.

    In total, the defendants executed more than 500 trades and made $2,651,320 in profits as a result of their fraudulent scheme.

    U.S. District Judge Leigh Martin May sentenced the defendants in the case as follows:

    •Milan Patel, 49, of Cumming, Georgia, was sentenced on January 23, 2025, to 18 months in prison followed by three years of supervised release. He was also ordered to pay a $10,000 fine. Patel was convicted on August 20, 2024, after he pleaded guilty to conspiracy to commit securities fraud.

    •Charles Parrino, 59, of West Palm Beach, Florida, was sentenced on January 17, 2025, to one year and one day in prison followed by three years of supervised release. He was also ordered to pay a $10,000 fine. Parrino was convicted on September 27, 2022, after he pleaded guilty to conspiracy to commit securities and wire fraud.

    •Mark Melnick, 44, of Marlboro, New Jersey, was sentenced on December 18, 2024, to three years’ probation with the first six months to be served on home confinement. He was also ordered to pay a $4,000 fine. Melnick was convicted on September 21, 2021, after he pleaded guilty to conspiracy to commit securities and wire fraud.

    •Anthony Salandra, 60, of Delray Beach, Florida, was sentenced on December 5, 2024, to three years’ probation with the first six months to be served on home confinement. Salandra was convicted on April 11, 2022, after he pleaded guilty to conspiracy to commit securities and wire fraud.

    •Bart Ross, 60, of Atlanta, Georgia, was sentenced on September 7, 2022, to three years’ probation. Ross was convicted on December 18, 2020, after he pleaded guilty to conspiracy to commit securities and wire fraud.

    This case was investigated by the Federal Bureau of Investigation with assistance from the Securities and Exchange Commission.

    Assistant U.S. Attorney Alex R. Sistla prosecuted the case.

    The SEC is investigating potential civil violations of the U.S. securities laws relating to above-described scheme. In connection with its investigation, the SEC filed separate civil enforcement actions against Patel, Parrino, Melnick, Salandra, and Ross in the U.S. District Court for the Northern District of Georgia.

    For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.

    MIL Security OSI

  • MIL-OSI Economics: Verizon delivered strong customer growth and profitability in 2024

    Source: Verizon

    Headline: Verizon delivered strong customer growth and profitability in 2024

    Download News Release PDF

    Download 4Q Financials PDF

    Download Non-GAAP Reconciliations PDF

    Key 2024 Highlights

    • Delivered on financial guidance
    • Revenue growth with strong operational results
    • More than doubled wireless postpaid phone net additions compared to 2023
    • Continued to take broadband market share with Fios and fixed wireless access
    • Strong execution against capital allocation priorities, including strategic transactions
    • Well-positioned with strong outlook for 2025

    NEW YORK – Verizon Communications Inc. (NYSE, Nasdaq: VZ) today reported strong operational and financial results for the fourth-quarter and full-year 2024, further extending its industry leadership with new products and services that continued to resonate with customers. With solid momentum on its strategy to grow connections and strengthen customer relationships, the company delivered on its 2024 financial guidance, demonstrating strong performance and success across its three priorities of growing wireless service revenue, expanding adjusted EBITDA and generating strong free cash flow.   

    “With innovations powered by the best network in the country, we are bringing the best experiences to our customers, in life and work. Customizable offerings like myPlan, myHome, Verizon Business Complete and Total Wireless feature the control, simplicity and value our customers expect,” said Verizon Chairman and CEO Hans Vestberg. “It’s only going to get better this year and beyond, as we have continued to strengthen Verizon with the pending Frontier acquisition, new satellite partnerships, and ongoing AI enablement, which we expect will enhance and broaden our network for everybody we serve.”

    2024 Financial Highlights

    Consolidated: Verizon delivers on 2024 financial guidance and extends industry leadership through operational excellence and customer focus

    • Full-year 2024 earnings per share (EPS) of $4.14 compared to $2.75 for full-year 2023; adjusted EPS1, excluding special items, of $4.59 compared to full-year 2023 adjusted EPS1 of $4.71.
    • Total operating revenue of $134.8 billion for full-year 2024, up 0.6 percent compared to full-year 2023.
    • Full-year 2024 cash flow from operations totaled $36.9 billion compared to $37.5 billion in 2023. This result reflects higher cash taxes, as well as higher interest expense. Full-year cash flow from operations includes a one-time contribution of approximately $2.0 billion from Verizon’s tower transaction with Vertical Bridge and reflects fourth quarter severance payments related to our voluntary separation program of approximately $600 million.
    • Full-year 2024 capital expenditures were $17.1 billion.
    • Full-year 2024 free cash flow1 of $19.8 billion compared to $18.7 billion in full-year 2023.

    4Q 2024 Highlights

    Consolidated: Strong fourth-quarter performance results in revenue increases

    • Earnings per share of $1.18 in fourth-quarter 2024 compared to EPS of $(0.64) in fourth-quarter 2023; adjusted EPS1, excluding special items, of $1.10 compared to $1.08 in fourth-quarter 2023.
    • Fourth-quarter 2024 financial results reflected a pre-tax gain from special items of $477 million. This includes a mark-to-market adjustment for our pension and other post-employment benefit (OPEB) liabilities of $668 million, partially offset by amortization of intangible assets related to Tracfone and other acquisitions of $191 million.
    • Total operating revenue of $35.7 billion in fourth-quarter 2024, up 1.6 percent compared to fourth-quarter 2023.
    • Consolidated net income for fourth-quarter 2024 was $5.1 billion compared to a net loss of $2.6 billion in fourth-quarter 2023. Consolidated adjusted EBITDA1 was $11.9 billion in fourth-quarter 2024 compared to $11.7 billion in fourth-quarter 2023. This result was driven by wireless service revenue growth, partially offset by the impact of higher upgrade volumes and continued declines in Business wireline revenue.
    • Verizon’s total unsecured debt as of the end of fourth-quarter 2024 was $117.9 billion, an $8.5 billion decrease compared to third-quarter 2024 and $10.6 billion lower year over year. The company’s net unsecured debt1 at the end of fourth-quarter 2024 was $113.7 billion. At the end of fourth-quarter 2024, Verizon’s ratio of unsecured debt to net income (LTM) was 6.6 times and net unsecured debt to consolidated adjusted EBITDA ratio1 was 2.3 times.

    Mobility: Industry-leading wireless service revenue and double-digit growth in postpaid phone net adds

    • Wireless service revenue2 grew sequentially for the 18th consecutive quarter. Total wireless service revenue2 in fourth-quarter 2024 was $20.0 billion, up 3.1 percent year over year, driven primarily by pricing actions implemented in recent quarters, sales of perks and add-on services and growth in fixed wireless access.
    • Wireless equipment revenue of $7.5 billion in fourth-quarter 2024, up 0.6 percent compared to fourth-quarter 2023, predominantly due to increased upgrade volumes in the quarter.
    • Total postpaid phone net additions of 568,000 in fourth-quarter 2024, up from 449,000 in fourth-quarter 2023.

    Broadband: Verizon continued to take broadband market share with strong demand for best in class Fios and fixed wireless access offerings

    • Broadband net additions of 408,000 in fourth-quarter 2024, continuing the quarterly pace of over 350,000 broadband net additions.
    • Total fixed wireless access net additions of 373,000 in fourth-quarter 2024, growing the base to nearly 4.6 million fixed wireless subscribers. The company is well-positioned to achieve the next milestone of 8 to 9 million fixed wireless access subscribers by 2028.
    • Fios internet net additions were 51,000 compared to 55,000 in fourth-quarter 2023.
    • Total broadband connections grew to more than 12.3 million as of the end of fourth-quarter 2024, representing a 15.0 percent increase year over year. 

    Verizon Consumer: Positive net additions with strongest quarterly phone gross additions result in five years

    • Total Verizon Consumer revenue in fourth-quarter 2024 was $27.6 billion, an increase of 2.2 percent year over year, predominantly driven by gains in service revenue.
    • Wireless service revenue in fourth-quarter 2024 was $16.5 billion, up 3.0 percent year over year, primarily driven by growth in Consumer wireless postpaid average revenue per account (ARPA) from pricing actions and continued fixed wireless access adoption.
    • Consumer wireless retail postpaid churn was 1.12 percent in fourth-quarter 2024, and wireless retail postpaid phone churn was 0.89 percent.
    • Consumer ARPA of $139.77 in fourth-quarter 2024, an increase of 4.2 percent compared to fourth-quarter 2023.
    • In fourth-quarter 2024, Consumer reported 426,000 wireless retail postpaid phone net additions, up 34.0 percent from fourth-quarter 2023. This improvement was driven by a 5.5 percent year over year increase in postpaid phone gross additions, which represented the strongest quarterly result for postpaid phone gross additions in five years.
    • Excluding the contribution from the company’s second number offering, Consumer reported 82,000 wireless retail postpaid phone net additions for the year, meeting the goal of positive net additions for 2024, and 367,000 wireless retail postpaid phone net additions for fourth-quarter 2024.
    • Excluding SafeLink, Verizon’s brand offering access to government-sponsored connectivity benefits and programs, in fourth-quarter 2024 Consumer reported 65,000 wireless retail prepaid net additions compared to 263,000 net losses in fourth-quarter 2023.
    • Consumer reported 216,000 fixed wireless net additions and 47,000 Fios Internet net additions in fourth-quarter 2024. Consumer Fios revenue was $2.9 billion in fourth-quarter 2024.
    • In fourth-quarter 2024, Consumer operating income was $6.9 billion, a decrease of 1.9 percent year over year, and segment operating income margin was 25.1 percent, compared to 26.1 percent in fourth-quarter 2023. Segment EBITDA1 in fourth-quarter 2024 was $10.3 billion, a decrease of 0.4 percent year over year. Improvements in Consumer wireless service revenue were more than offset by increases in upgrade volumes and the impact of related promotions in the period. Segment EBITDA margin1 in fourth-quarter 2024 was 37.5 percent compared to 38.5 percent in fourth-quarter 2023.

    Verizon Business: Strong wireless service revenue driven by continued wireless customer growth

    • Business wireless service revenue in fourth-quarter 2024 was $3.5 billion, an increase of 3.4 percent year over year. This result was driven by continued strong net additions for both mobility and fixed wireless access, as well as benefits from pricing actions implemented in recent quarters.
    • Total Verizon Business revenue was $7.5 billion in fourth-quarter 2024, a decrease of 1.5 percent year over year, as increases in wireless service revenue were more than offset by decreases in wireline revenue.
    • Business reported 283,000 wireless retail postpaid net additions in fourth-quarter 2024. This result included 142,000 postpaid phone net additions. Our value proposition continued to resonate across all customer groups with particular strength in small and medium businesses.
    • Business wireless retail postpaid churn was 1.45 percent in fourth-quarter 2024, and wireless retail postpaid phone churn was 1.09 percent.
    • Business reported 157,000 fixed wireless net additions in fourth-quarter 2024.
    • In fourth-quarter 2024, Verizon Business operating income was $594 million, an increase of 34.1 percent year over year, resulting in segment operating income margin of 7.9 percent, an increase from 5.8 percent in fourth-quarter 2023. Segment EBITDAin fourth-quarter 2024 was $1.7 billion, an increase of 3.0 percent year over year. The result was driven by wireless service revenue growth partially offset by wireline revenue declines. Segment EBITDA margin1 in fourth-quarter 2024 was 22.1 percent, an increase from 21.1 percent in fourth-quarter 2023.

    Outlook and guidance

    The company does not provide a reconciliation for certain of the following adjusted (non-GAAP) forecasts because it cannot, without unreasonable effort, predict the special items that could arise, and the company is unable to address the probable significance of the unavailable information.  

    For 2025, Verizon expects the following:

    • Total wireless service revenue growth2 3 of 2.0 percent to 2.8 percent.
    • Adjusted EBITDA growth1 of 2.0 percent to 3.5 percent.
    • Adjusted EPS1 growth of 0 to 3.0 percent.
    • Cash flow from operations of $35.0 billion to $37.0 billion.
    • Capital expenditures between $17.5 billion and $18.5 billion.
    • Free cash flow1 of $17.5 billion to $18.5 billion.

    1 Non-GAAP financial measure. See the accompanying schedules and http://www.verizon.com/about/investors for reconciliations of non-GAAP financial measures cited in this document to most directly comparable financial measures under generally accepted accounting principles (GAAP).

    Total wireless service revenue represents the sum of Consumer and Business segments.

    3 Reflects the reclassification of recurring device protection and insurance related plan revenues from other revenue into wireless service revenue beginning January 2025. Where applicable, historical results will be recast to conform to the updated presentation. Reclassified 2024 annual revenues were more than $2.9 billion.

    Verizon Communications Inc. (NYSE, Nasdaq: VZ) powers and empowers how its millions of customers live, work and play, delivering on their demand for mobility, reliable network connectivity and security. Headquartered in New York City, serving countries worldwide and nearly all of the Fortune 500, Verizon generated revenues of $134.8 billion in 2024. Verizon’s world-class team never stops innovating to meet customers where they are today and equip them for the needs of tomorrow. For more, visit verizon.com or find a retail location at verizon.com/stores.


    Forward-looking statements

    In this communication we have made forward-looking statements. These statements are based on our estimates and assumptions and are subject to risks and uncertainties. Forward-looking statements include the information concerning our possible or assumed future results of operations. Forward-looking statements also include those preceded or followed by the words “anticipates,” “assumes,” “believes,” “estimates,” “expects,” “forecasts,” “hopes,” “intends,” “plans,” “targets” or similar expressions. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The following important factors, along with those discussed in our filings with the Securities and Exchange Commission (the “SEC”), could affect future results and could cause those results to differ materially from those expressed in the forward-looking statements: the effects of competition in the markets in which we operate, including the inability to successfully respond to competitive factors such as prices, promotional incentives and evolving consumer preferences; failure to take advantage of, or respond to competitors’ use of, developments in technology, including artificial intelligence, and address changes in consumer demand; performance issues or delays in the deployment of our 5G network resulting in significant costs or a reduction in the anticipated benefits of the enhancement to our networks; the inability to implement our business strategy; adverse conditions in the U.S. and international economies, including inflation and changing interest rates in the markets in which we operate; cyberattacks impacting our networks or systems and any resulting financial or reputational impact; damage to our infrastructure or disruption of our operations from natural disasters, extreme weather conditions, acts of war, terrorist attacks or other hostile acts and any resulting financial or reputational impact; disruption of our key suppliers’ or vendors’ provisioning of products or services, including as a result of geopolitical factors or the potential impacts of global climate change; material adverse changes in labor matters and any resulting financial or operational impact; damage to our reputation or brands; the impact of public health crises on our business, operations, employees and customers; changes in the regulatory environment in which we operate, including any increase in restrictions on our ability to operate our networks or businesses; allegations regarding the release of hazardous materials or pollutants into the environment from our, or our predecessors’, network assets and any related government investigations, regulatory developments, litigation, penalties and other liability, remediation and compliance costs, operational impacts or reputational damage; our high level of indebtedness; significant litigation and any resulting material expenses incurred in defending against lawsuits or paying awards or settlements; an adverse change in the ratings afforded our debt securities by nationally accredited ratings organizations or adverse conditions in the credit markets affecting the cost, including interest rates, and/or availability of further financing; significant increases in benefit plan costs or lower investment returns on plan assets; changes in tax laws or regulations, or in their interpretation, or challenges to our tax positions, resulting in additional tax expense or liabilities; changes in accounting assumptions that regulatory agencies, including the SEC, may require or that result from changes in the accounting rules or their application, which could result in an impact on earnings; and risks associated with mergers, acquisitions, divestitures and other strategic transactions, including our ability to consummate the proposed acquisition of Frontier Communications Parent, Inc. and obtain cost savings, synergies and other anticipated benefits within the expected time period or at all.

    MIL OSI Economics

  • MIL-OSI Security: Delaware Man Sentenced to 135 Months in Federal Prison for Second Conviction Involving Child Sexual Abuse Material

    Source: Office of United States Attorneys

    WILMINGTON, Del. – Melvin Janvier, 37, of Newark, Delaware was sentenced on January 23, 2025, to 135 months in federal prison for possessing child sexual abuse material (“CSAM”), announced Shannon T. Hanson, Acting U.S. Attorney for the District of Delaware.  Following his time in prison, he will spend 15 years on federal supervised release.  U.S. District Court Judge Maryellen Noreika pronounced the sentence.

    According to court documents, the FBI Violent Crimes Against Children Unit, with the assistance of State of Delaware Probation and Parole, arrested Janvier after an FBI Child Exploitation Task Force investigation indicated Janvier was in possession of and sending CSAM from Janvier’s cellphone through the Internet in July 2021. 

    Law enforcement later found over 2,000 files containing CSAM on Janvier’s phone.  The files found on the device included images and videos of prepubescent minors, to include infants and toddlers, and materials portraying bondage and bestiality.  Janvier had previously been convicted in 2016 in the State of Delaware for possession of and dealing in CSAM and served four years in prison.

    Acting U.S. Attorney Hanson stated, “Our office is committed to protecting children and prosecuting those engaged in the sexual exploitation of minors through the possession and distribution of child sexual abuse material.  I wish to thank the FBI and our Delaware law enforcement partners who tirelessly pursed this case.”

    “There is nothing that can excuse Melvin Janvier’s sick behavior. Every one of the more than 2,000 images he possessed re-victimizes a child,” said FBI Baltimore SAC William J. DelBagno. “FBI Baltimore’s Violent Crimes Against Children Task Force is committed to putting predators like Janvier behind bars where they can no longer hurt others.”

    The FBI Baltimore Field Office, with the assistance from the FBI Washington Field Office and the State of Delaware Probation and Parole, investigated this case. Assistant U.S. Attorneys Samuel S. Frey and Briana Knox prosecuted the case. 

    A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 22-CR-78-MN.

    This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the U.S. Department of Justice.  Led by U.S. Attorney’s Offices across the country and the Child Exploitation and Obscenity Section of the Department of Justice, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims.  For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.

    MIL Security OSI

  • MIL-OSI Security: Fort Bliss Soldier Sentenced to 8 Years in Federal Prison for Sexual Abuse of a Minor

    Source: Office of United States Attorneys

    EL PASO, Texas – A former soldier stationed at Fort Bliss was sentenced in a federal court in El Paso to 100 months in prison for sexual abuse of a minor.

    According to court documents, Carlos Humberto Richard Walsh, 23, of Washington, was involved in a romantic relationship with a minor under 16 years old from approximately Oct. 1, 2022 to approximately Jan. 24, 2023. Walsh, who was an Army specialist at the time, was subjected to barracks inspections, through which his command reported finding the minor victim in Walsh’s vehicle, along with several of the victim’s personal items in Walsh’s barracks room. The minor victim admitted to federal and local law enforcement that she had been living with Walsh in the Barracks and had engaged in sexual intercourse there on several occasions. Walsh was arrested May 25, 2023 and has remained in federal custody.

    U.S. Attorney Jaime Esparza of the Western District of Texas made the announcement.

    Homeland Security Investigations, the Department of the Army Criminal Investigation Division, the Texas Department of Public Safety, and the El Paso Police Department investigated the case.

    Assistant U.S. Attorney Sarah Valenzuela prosecuted the case.

    This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.

     

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    MIL Security OSI

  • MIL-OSI Asia-Pac: Second meeting of the BIMSTEC expert group on Cyber Security Cooperation

    Source: Government of India

    Posted On: 24 JAN 2025 11:48AM by PIB Delhi

    The National Security Council Secretariat, Government of India organized Second Meeting of the BIMSTEC Expert Group on Cyber Security Cooperation on 21 January 2025 in New Delhi. The First BIMSTEC Experts Group Meeting on Cyber Security was also hosted by India in 2022 at New Delhi.

    The main objective of this BIMSTEC Expert Group meeting is to formulate the Action Plan which will bolster coordination and collaboration amongst the BIMSTEC Member States for strengthening the Cyber Security in the use of ICTs. This Action Plan will cover the mechanisms for the exchange of cyber related information, cybercrime, protection of critical information infrastructures, cyber incident response and international developments related to cyber norms. This Action Plan has been proposed to be implemented within the time frame of 5 years.

    Some significant exchanges have taken place during the second meeting, which are building BIMSTEC CERT-TO-CERT cooperation mechanism, Cybercrime Cooperation Framework amongst the Law Enforcement agencies and capacity building programmes on cyber security in the region. Among various presentations, India also presented about its Initiatives of Indian Cybercrime Coordination Centre (I4C) on “Cyber Hygiene for school children”.

    The Meeting agreed that implementation of the Action Plan will be a major step towards strengthening cyber security cooperation in BIMSTEC.  By taking these steps, BIMSTEC countries can work together to create a more secure and resilient cyber space in the region.  

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    MJPS/SR

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    MIL OSI Asia Pacific News