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Saudi FM criticizes EU business with Iran



European companies engaged in business with Iran are enriching the country’s Islamic Revolutionary Guard Corps (IRGC) and inadvertently fueling its military activities in the wider Middle East, Saudi Foreign Minister Adel Al-Jubeir told CNBC on Sunday.

“We believe that a large percentage of the Iranian economy is controlled by the Revolutionary Guards and companies associated with the guards. And we believe that any dealings with those companies only serve to enrich the Revolutionary Guards and cause them to cause more mischief within the region and the world,” Al-Jubeir said, referencing the billions of dollars’ worth of deals struck between European companies and Iran since the lifting of international sanctions in 2015.

Tasked with defending the state and Iran’s Islamic ideals, the powerful IRGC — the branch of Iran’s military founded after the 1979 Islamic Revolution — is widely alleged to support militant activity by groups like Hezbollah around the region, from Iraq and Lebanon to Syria. It is also believed to control around a third of the country’s economy.

The passing of the Joint Comprehensive Plan of Action (JCPOA) in 2015, which lifted international sanctions on Iran in exchange for curbs on its nuclear development, saw a wave of new investment and business come into the country from Europe, led by Germany, France and the U.K. European multinationals Airbus, Siemens, Peugeot and Total have all struck major deals in the country worth billions.

Speaking at the Munich Security Conference, America’s top national security advisor H.R. McMaster described European nations like Germany doing business with Iran as essentially writing a blank check to the IRGC.

Asked if he agreed with McMaster’s assessment, Al-Jubeir said yes.

“We are talking to our friends in Europe about this. We are letting them know that the nuclear agreement that was signed with Iran is lacking,” Al-Jubeir said, describing what he believed were flaws within the agreement’s sunset clause (the timeframe for restrictions on its nuclear development) and the thoroughness of United Nations (UN) inspections.

“We also believe the nuclear agreement itself does not resolve the issue of Iran’s radical behavior which has to do with the ballistic missile resolutions of the United Nations … They also do not deal with the issue of Iran’s support for terrorism,” Al-Jubeir said.

Iran has consistently said it is abiding by all the parameters of the deal, a claim that has been backed up by UN inspectors.

Speaking Sunday to NBC News, Iranian Foreign Minister Javad Zarif said the U.S. was jeopardizing the nuclear deal.

“I believe President Trump has tried to walk away from that deal from day one of his presidency, and he has done everything in bad faith to prevent Iran from enjoying the benefits of the deal already. So we believe the United States is already in violation of very serious and important provisions of the nuclear deal,” he said.

Between the singing of the JCPOA and February 2017, Iran conducted up to 14 missile tests, in violation of UN resolutions. The minister emphasized his government’s belief that Iran should be punished for these alleged violations.

Sanctions on the IRCG have not been lifted, and many businesses remain wary of investing in Iran because any transaction that touches an IRGC-affiliated entity could be met with severe fines from the U.S.

While the U.S. has listed Iran as a state-sponsor of terror, it has not labeled the IRGC a terrorist organization, though in October of last year President Donald Trump said that the Corps had played “a central role to Iran becoming the world’s foremost state sponsor of terror.”

Fearing U.S. abandonment of the JCPOA, the foreign ministers of Germany, France and the U.K. in have urged the Trump administration to remain faithful to the deal, insisting that it is essential to international security. Federica Mogherini, the EU’s top diplomat, said in January that it “made the world safer and prevented a potential nuclear arms race in the region.”

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Doctor warns Southern states vulnerable to Delta variant this summer



Dr. Peter Hotez warned that Southern U.S. states could feel the impact of the highly transmissible Delta Covid variant as early as this summer, due in part to low vaccination rates. 

“I’m really holding my breath about the South and what happens over the summer,” said Hotez, co-director of the Center for Vaccine Development at Texas Children’s Hospital.

“Here in the South, particularly in Louisiana, Mississippi, we’re seeing really low vaccination rates. And less than 10% of adolescents are vaccinated in many of these southern states, so we have a real vulnerability here,” Hotez said.

A new study in the U.K. found Pfizer’s vaccine is 88% effective against the Delta variant, which was first discovered in India.

Vaccination rates vary across the U.S.: More than 50% of the population in many Northeastern states is now fully vaccinated, compared with just around 30% of the population in many Southeastern states, according to data from the Centers for Disease Control and Prevention

On Tuesday, White House chief medical advisor Dr. Anthony Fauci, stressed the importance of vaccines to protect against the Delta variant, which he said accounts for more than 6% of the U.S. coronavirus infections that scientists have genetically sequenced.

Hotez also told CNBC’s “The News with Shepard Smith” that he’s still recommending Covid vaccinations to adolescents, despite CDC warnings over a higher-than-expected number of cases of heart inflammation in 16- to 24-year-olds.

“I’m pretty convinced that the possibility of severe Covid-19 from this new Delta variant is a far bigger concern, so I’m strongly recommending for adolescents to get their two doses of the vaccine,” Hotez said.

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IRS delays tax refunds, stimulus checks amid identity fraud suspicion



Samuel Corum/Bloomberg via Getty Images

Jeff Lavigne plans to use a tax refund this year for long-delayed medical help.

Yet his refund, almost $2,700, has been in limbo since mid-March, when Lavigne filed his tax return, records show.

The IRS flagged the return for potential identity theft — as it did for nearly 2 million Americans last year.

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The money has been withheld until Lavigne can verify his identity. The process has proven difficult — phone lines are clogged and online authentication is unavailable.

Lavigne, 42, has chronic back pain that makes work difficult over sustained periods. The former restaurant manager doesn’t have a full-time job or health insurance. An extra $2,700, which includes pandemic stimulus funds, would help pay for monthly premiums and let him visit a specialist.

“I started making plans in my head, in terms of getting the help I need,” said Lavigne, who lives in a suburb of Dallas. “I’m trying to take one step at a time, and this is step one.”

Delayed tax refunds

Jeff Lavigne, 42, filed his federal tax return in March. He hasn’t yet received his refund. The IRS flagged the return for potential identity fraud.

Jeff Lavigne

It’s unclear how many taxpayers’ refunds have been delayed during the 2021 filing season. But it’s an issue for a growing number of Americans.

The IRS flagged 5.2 million tax refunds for fraud last year, a nearly 50% increase over 2019, according to the Taxpayer Advocate Service, an independent organization within the IRS.

Of those, about 1.9 million were flagged for identity screening. (The rest were earmarked for income verification.)

Basically, the IRS wants to ensure a crook isn’t using a taxpayer’s identity to claim a tax refund. The agency mails letters (either a 5071C or 6331C letter) to taxpayers if it suspects foul play. The IRS can’t process a tax return or issue a refund until the person responds.

However, most flagged returns aren’t fraudulent. In 2019, 63% of the refunds vetted for identity theft turned out to be legitimate, according to the Taxpayer Advocate Service.

Ultimately they might get their money but they’re not getting their money now.

Nina Olson

Executive director and founder of the Center for Taxpayer Rights

While the IRS ultimately issues the money (with interest) in these cases, taxpayers sometime wait months. About 18% of refunds flagged for identity verification took longer than 120 days to arrive, according to the Taxpayer Advocate Service. (Most take less than 21 days for online filers or six weeks for mailed returns, the IRS said.)

Refund delays were among the top 10 most serious taxpayer problems in 2020, the Taxpayer Advocate Service said.

Dan Herron, a certified financial planner and accountant, waited almost a year for a tax refund after filing his return in 2019, which got flagged for possible identity fraud.

“It was a pretty lengthy, drawn-out process,” said Herron, a principal of Elemental Wealth Advisors in San Luis Obispo, California.

“I wish [the IRS] had something more streamlined,” he added. “They’re so archaic in the way they do things.”

Delays were likely exacerbated by the Covid pandemic since the IRS had to temporarily suspend some of its in-person operations, according to Nina Olson, executive director and founder of the Center for Taxpayer Rights.

And the wait may cost taxpayers more than usual this year. The IRS is using 2020 tax returns to determine eligibility for pandemic stimulus checks and advanced payments of the child tax credit, which will be paid monthly starting in mid-July.

The agency uses information (such as annual income) on a 2019 return if a 2020 return hasn’t been processed. But that may lead to reduced payments — or no payments — depending on a taxpayer’s situation.

“Ultimately they might get their money but they’re not getting their money now,” Olson said.

‘Insufficient resources’

Taxpayer advocates don’t dispute that stopping thieves from ripping off individuals and the government is a worthwhile goal.

“Identity theft has been on this upward curve since 2005,” Olson said. “It’s a huge issue.

“And thieves are getting smarter.”

The IRS fraud measures protected $3.5 billion in revenue in 2019, according to the agency. (About $2.5 billion was due to identity theft filters.)

And 98% of tax returns claiming a refund aren’t ensnared by the process, the agency said.

Mark Mazur, deputy assistant secretary for tax policy at the Treasury Department.

Andrew Harrer/Bloomberg via Getty Images

“We understand the concerns of how refund delays can impact taxpayers, and we continue to collaborate with internal and external partners to refine and automate refund fraud filters where appropriate,” the IRS said in response to a Taxpayer Advocate Service report to Congress last year.

Without proper validation, the IRS risks issuing improper refunds, the agency said.

However, IRS systems, staffing and processes are combining to delay too large a share of refunds, taxpayer advocates said.

For example, many people are given the option of verifying their identities online using an IRS website. To do so, they must first go through an authentication process called “Secure Access.” But less than half succeeded in 2020, according to the Taxpayer Advocate Service.

Such taxpayers must then interface with an IRS agent, over the phone or at a field office, for a resolution. Right now, the IRS doesn’t have enough staff to manage the volume efficiently, Olson said.

IRS technology also doesn’t leverage machine-learning — meaning the system can’t adapt automatically if it’s tripping up too many legitimate taxpayers, she added. It requires a manual fix.

The IRS has had insufficient resources to meet enforcement and administrative challenges and to deliver customer service to taxpayers.

Mark Mazur

deputy assistant secretary for tax policy at the Treasury Department

“You are setting a goal to stop fraud, but not setting a goal to minimize false positives,” Olson said of the IRS. “And good systems do both.”

While fraud letters request a response within 30 days, the IRS will continue to work with taxpayers regardless of the amount of days that have passed, according to the IRS.

The IRS budget — which largely covers personnel — has fallen by 20% in real terms over the last decade, Mark Mazur, deputy assistant secretary for tax policy at the Treasury Department, said Thursday during a House of Representatives hearing.

“The IRS has had insufficient resources to meet enforcement and administrative challenges and to deliver customer service to taxpayers,” Mazur said.

Technology upgrades would also improve service, by letting taxpayers communicate with the IRS in a “clear, timely manner,” he added.

A stroke of luck

Lavigne had been thwarted at each juncture by the time CNBC initially spoke to him on Tuesday.

He was unable to verify his identity online and couldn’t reach a phone representative due to a high volume of calls into the agency. He hadn’t been able to schedule an appointment at a local branch.

Lavigne wasn’t even sure he could physically attend an in-person meeting — traveling for long stretches is prohibitive due to his spine problems, he said.

However, Lavigne’s luck changed on Thursday. He was able to reach someone by phone at the local office in Farmers Branch, Texas. After an hour and a half, a representative completed the identity verification over the phone, Lavigne said.  

“She explained there is a very long list of filters in place to reduce ID theft and nobody can know how it exactly works so that thieves cannot create a way to work around that,” he recalled of their discussion.

Now, the funds will take up to nine weeks to arrive.

“She said I am definitely good to go now,” Lavigne said. “But if I do not receive my check or another letter between now and the end of the nine weeks, which is sometime in August, [she said] to call back.”

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More pets eating insect food to fight climate change for owners



“I would certainly consider feeding my dogs insects as a treat or training reward,” says Laurie Dunbar, a veterinarian at Pierrefonds Animal Hospital in Montreal.

Sally Anscombe | DigitalVision | Getty Images

What do black soldier fly grubs taste like? Stilton and cheese biscuits. At least that’s how British start-up Yora Pet Foods describes its dog food made from the bugs.

Established in 2019, Yora introduced the first insect protein pet food sold in the U.K. Targeting environmentally conscious pet owners, it expects to have shipped over 200 tons of product to more than 200 countries and generate sales over $2.8 million. Its business is part of a movement in which manufacturers in North America, Europe and beyond are trying to make pet food more sustainable and environmentally friendly by using proteins from insects instead of animals.

“We expect that as consumers become more conscious of their own carbon footprints — and the carbon ‘pawprints’ of their pets — insect protein will be embraced by more and more pet owners as a viable and marketable alternative to traditional meat,” says Yora managing director Glenn Rankin, adding that pets consume an estimated 20% of meat and fish in their countries.

Livestock, climate and culinary changes

Despite concerns by some scientists about the many unknowns associated with farming them on a vast scale, insects are already an emerging trend in sustainable foods for people.

According to a 2017 Dutch review study, compared to livestock production the advantages of insect farming include: requiring less land and water, emitting less greenhouse gases, having high feed conversion efficiencies, and being useful as animal or aqua feed. A 2020 study by researchers in the U.K. and Germany, presenting what they called the first analysis of its kind, concluded that the impacts of pet food “are equivalent to an environmental footprint of around twice the U.K. land area, and would make greenhouse gas emission from pet food around the 60th highest emitting country, or equivalent to total emissions from countries such as Mozambique or the Philippines.”

Against this background, a European Commission panel recently endorsed draft legislation that would certify mealworm beetle larvae, aka yellow mealworm, as safe to eat — the first insect approved in the 27-nation bloc. The grubs can be eaten whole and dried or as an ingredient. “The use of insects as an alternate source of protein is not new and insects are regularly eaten in many parts of the world,” the commission noted.

Backed by Robert Downey Jr.’s investment group Footprint Coalition, French insect food company Ynsect, which specializes in yellow mealworm, announced in April it has acquired Dutch rival Protifarm, a maker of mealworm ingredients for human applications. Ynsect will now have a total capacity of over 230,000 metric tons of ingredients per year.   

For many people, though, bugs are less than appetizing. By comparison, getting our furry friends to feast on insects might be a walk in the park. Start-ups and long-established companies are introducing bugs to change the pet food market, which was worth some $42 billion in the U.S. in 2020, according to the American Pet Products Association.

“I would certainly consider feeding my dogs insects as a treat or training reward,” says Laurie Dunbar, a veterinarian at Pierrefonds Animal Hospital in Montreal who isn’t keen on eating bugs herself but thinks they make sense for dogs and other animals that naturally consume them. “I would also have no issues with insects as a protein source in a formula that was well balanced for the dog’s age and lifestyle. … I would feel comfortable recommending it to clients who are looking for environmentally sound alternatives to meat-based diets, and for pets with allergies to traditional protein sources.”

Demand for insect protein

Demand for insect protein as an ingredient in pet food and animal feed could hit half a million metric tons in 2030, up from about 10,000 metric tons currently, according to a 2021 report by RaboResearch, a Dutch food and agribusiness research group. “The insect industry is on a path to increase scale, backed by investments and partnerships. Efficiency gains due to increasing technology, automation, improvements in genetics and legislative changes will also enable costs to decrease,” the report noted, adding that doubling or quadrupling production volume will take much less time once the half-million threshold is reached. 

“While the sustainability aspects and functional benefits support demand growth, high costs and prices, the current limited production capacity, and legislation are the main factors limiting growth of insect protein,” RaboResearch said in introducing the report.  

In March, Mars Petcare, part of confectionery giant Mars, announced Lovebug, a dry cat food made without traditional beef or poultry protein. It’s created from black soldier fly larvae insect meal and sold in the U.K. The food is aimed at “pet parents” who care about sustainability since insects take up 80% less land than beef per kilogram of protein, according to Mars. In addition, the grubs are fed on surplus veggies and plants and sourced from a farm powered by 100% renewable electricity.

Dogs will eat it, but the biggest obstacle is getting consumers to accept it with open arms.

Phillip Cooper,

Last November, Nestlé introduced a Purina pet food containing fly larvae, plant and animal protein. Launched in Switzerland, Purina Beyond Nature’s Protein for dogs and cats comes in two formulations: one based on chicken, pig liver and millet, and the other based on protein from black soldier fly larvae, chicken and fava beans.

“We carefully balanced the contribution of the different protein sources, including insects, in our cat and dog recipes to fulfill their specific nutritional needs,” says Dan Smith, head of Nestlé’s Global Strategic Business Unit for pet care. “Consumer acceptance is promising. We carried out some research in December 2020, and found that a significant majority of the Swiss consumers who tried the range confirmed that their pet liked the product and that they would repurchase the product.” 

U.S. pet food market

The pet industry has boomed during the pandemic, with purchase and adoption of pets rising, spending on pets hitting a record in 2020, and the trend so intense veterinarians have struggled to keep up with demand. Following the introduction of cricket-based pet treats in recent years, more insect pet food may come to North America during this peak pet era.

HOPE Pet Foods is a University of Toronto spinoff launched in 2020. This summer, it plans to release treats and food based on alternative proteins such as algae and black soldier fly larvae.

“We know dogs love the nutty taste of our products, which is characteristic of the insect ingredients we use,” says HOPE co-founder and CEO Sofia Bonilla, who learned about the alternative proteins while working as a postdoctoral researcher in the Netherlands. “Alternative proteins can offer equal if not better nutritional profiles to the foods that we currently consume, and they are much less environmentally costly to produce.” 

Phillip Cooper, a pet industry expert based in California, says insect food sales in the U.S. account for less than 2% of sales but pet food manufacturers are always looking for new and better sources of protein.

“I do expect this trend to continue to grow and it seems cricket protein seems to be the most popular and the most plentiful,” says Cooper. “Dogs will eat it, but the biggest obstacle is getting consumers to accept it with open arms.”

He says “the healthy crowd” — consumers concerned about sustainability and the environment — will support new ideas, but most major retailers generally follow wait for broader adoption and are price conscious. “Until we see major investors invest in supply chain, packaging and advertising, I expect this segment to grow in single digits yearly,” Cooper said.

U.S. regulations may soon change to allow more bugs in pet food. In general, ingredients used in animal food must be either approved food additives or be generally recognized as safe (GRAS), according to the Food and Drug Administration. In coordination with state feed control officials, the FDA recognizes ingredients in the Official Publication of the Association of American Feed Control Officials (AAFCO) as being acceptable for animal food.

The AAFCO’s ingredient definition committee has voted to accept dried black soldier fly larvae for use in adult dog food. However, the ingredient has not yet been published by AAFCO because it has not gone through all of the necessary steps, an FDA spokesperson said. AAFCO did not respond to a request for comment. 

“Use of insects in pet food would require assessment of safety and utility through a food additive petition unless the ingredient is GRAS for use in pet food in order to be legally marketed,” the spokesperson said. “It is important to note that insect proteins, like animal or plant proteins, can come from a wide range of sources, so each type of insect protein (e.g., crickets, flies, worms, various types of larvae) would need to be evaluated and approved separately. In addition, how the insects are raised may impact safety and will need to be considered.”

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