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OTHER THINGS YOU MAY HAVE MISSED – AUGUST 5

Panama Covid-19 update – in the news today, the government to enact a new decree whereby those caught on the street when positive for covid-19 can be detained and taken into custody, perhaps to taken to a requisitioned hotel – the health ministry saying that young people are underestimating “the problem we have” and “there are irresponsible people”.

Meanwhile, 807 new cases take us to 70,231 to date and currently 23,886 active cases. fatalities up again, to 31 – making a total of 1,553 to date.  1,504 are hospitalised, with 164 being in ICU.

5 August 2020

EAST AFRICAN REGIONAL ORGANISATION COMBATING IUU FISHING

FISH-I Africa is a partnership of 8 East African countries – Comoros, Kenya, Madagascar, Mauritius, Mozambique, Seychelles, Somalia and Tanzania – that brings together national enforcement authorities, regional organisations and international technical and legal experts to combat large-scale illegal fishing in the Western Indian Ocean through information-sharing and regional cooperation. 1 in 4 fish in Africa is caught illegally, this threatens the sustainability of fish stocks, damages the ecosystem and deprives governments of income and people of livelihoods.

https://stopillegalfishing.com/initiatives/fish-i-africa/

 THE HUNT FOR THE FISH PIRATES WHO EXPLOIT THE SEA

On 5 June, the BBC published this feature focusing on the Andrey Dolgov – saying that for 10 years, a rogue fishing vessel and its crew plundered the world’s oceans, escaping repeated attempts of capture. Then a dramatic pursuit across the high seas finally netted the one that got away.

https://www.bbc.com/future/article/20190213-the-dramatic-hunt-for-the-fish-pirates-exploiting-our-seas

FLAG, COASTAL AND PORT AUTHORITIES FROM 8 COUNTRIES HAVE MET VIRTUALLY LAUNCH THE MARITIME AUTONOMOUS SURFACE SHIPS (MASS) IN PORTS

On 5 August, Seatrade Maritime News reported that MASSPorts is a network formed by like-minded states and organisations to address the challenges and achieve alignment of standards for the trials and operation of MASS in ports to allow for autonomous operations for vessels.

https://www.seatrade-maritime.com/technology/eight-nations-join-hands-align-standards-autonomous-ships

US POSTAL SERVICE URGED TO STOP DELIVERING MYSTERIOUS SEEDS

On 4 August, the Wall Street Journal reported that state agriculture officials in the US are urging the USPS to stop delivering the mysterious seed packages that have been arriving in mailboxes across the country, and that federal officials believe are coming from China. Officials are concerned the seeds could introduce weeds, pests etc.

https://www.wsj.com/articles/u-s-postal-service-is-urged-to-stop-delivering-mysterious-seeds-11596555249

US DoJ SEEKS AS MUCH AS $18.1 BILLION FROM PURDUE PHARMA

On 4 August, the Wall Street Journal reported that the DoJ is seeking as much as $18.1 billion from bankrupt opioid maker Purdue Pharma LP, in a demand that could disrupt the company’s months long effort to reach a settlement with states and local communities that accuse it of helping fuel the opioid crisis. Federal prosecutors are investigating both whether its marketing and distribution of opioids violated criminal statutes including anti-kickback laws, misbranding and conspiracy, and whether Purdue offered kickbacks to doctors and pharmacies to encourage them to prescribe and dispense more OxyContin, as well as whether the company transferred cash to hide money from creditors.

https://www.wsj.com/articles/justice-department-seeks-as-much-as-18-1-billion-from-purdue-pharma-11596595629

MORE THAN 200 INSTITUTIONS AROUND THE WORLD AFFECTED BY BLACKBAUD RANSOMWARE ATTACK

On 4 August, the Dallas Morning News reported that the George W Bush Presidential Center, Boy Scouts of America, the Texas Tech Foundation and the University of Texas at Austin have notified donors that they are a part of a growing list of non-profits and universities affected by a ransomware attack. South Carolina-based Blackbaud, one of the world’s largest cloud-based data storage and software providers for institutions of higher education and non-profits, has revealed that it was the subject of a ransomware attack in May.

https://www.dallasnews.com/business/technology/2020/08/03/bush-presidential-center-boy-scouts-of-america-texas-tech-foundation-among-hundreds-hit-in-blackbaud-ransomware-attack/

SOUTH AFRICAN ANTI-CORRUPTION WATCHDOG PROBES COVID-19 TENDERS

On 5 August, KYC 360 reported that the Public Protector has said that it was investigating irregularities in coronavirus-related tenders, the latest in a series of scandals that trade unions said showed the government’s failure to tackle graft, with separate inquiries into the procurement of personal protective equipment (PPE) in Gauteng province, the country’s economic heartland.

https://www.riskscreen.com/kyc360/news/south-african-anti-corruption-watchdog-probes-covid-19-tenders

SAUDI ARABIA HAS BUILT YELLOWCAKE URANIUM PROCESSING PLANT

On 4 August, Al Jazeera reported a Wall Street Journal article claiming that Saudi Arabia, with help from China, has built a facility for the extraction of uranium yellowcake, a potential precursor to fuel for a nuclear reactor, in a remote desert location.  It has raised concern that the nuclear programme is moving ahead, and that the country is keeping open an option to develop nuclear weapons, according to the report. Yellowcake is processed from naturally occurring uranium ore and can be further enriched to create fuel for nuclear power plants and, at very high levels of enrichment, nuclear weapons.

https://www.aljazeera.com/ajimpact/saudi-arabia-built-yellowcake-uranium-processing-plant-wsj-200804233729233.html

NEW YORK CITY BAR ASSOCIATION DENOUNCES TRUMP THREAT OF SANCTIONS AGAINST INTERNATIONAL CRIMINAL COURT LAWYERS

On 5 August, Law.com reported that the New York City Bar Association is urging the Trump administration’s and the US Congress to resist an executive order that it says “particularly targets” ICC lawyers who are investigating, in part, war crimes allegedly committed by US forces in Afghanistan and at CIA “black sites”.

https://www.law.com/newyorklawjournal/2020/08/05/city-bar-denounces-trump-order-threatening-sanctions-against-international-court-lawyers-investigating-possible-us-war-crimes/

MALAYSIA: 25 ENFORCEMENT OFFICERS ARRESTED FOR ABETTING IN SMUGGLING ILLEGAL IMMIGRANTS

On 5 August, the New Strait Times reported that since 1 May a total of 25 enforcement personnel have been arrested for abetting the illegal immigrants – 18 policemen and officers, 5 members of the Malaysian Armed Forces and 2 immigration officers. It is also reported that a total of 3,597 individuals, comprising 2,625 illegal immigrants, 602 others and 370 informants who abetted in the smuggling of illegal immigrants into the country had been arrested.

https://www.nst.com.my/news/nation/2020/08/614171/25-enforcement-officers-arrested-abetting-smuggling-illegal-immigrants

GERMANY HAS A COMPLIANCE AND ENFORCEMENT PROBLEM

On 5 August, a post on the FCPA Blog asks why Germany applies double standards in respect of white collar crime.

https://fcpablog.com/2020/08/05/yes-germany-has-a-compliance-and-enforcement-problem/

INSIDE THE ILLICIT GOLD TRADE – USING FINANCIAL TOOLS AND PUBLIC POLICY TO FIGHT MONEY LAUNDERING

On 4 August, Global Financial Integrity reported that 2 webinars are available online. The first looks at the use of trade data and other financial tools to examine how the illicit trade in gold can be more effectively understood and tracked. It demonstrates investigative techniques to identify trade-based money laundering risks, as well as other red flag indicators of heightened money laundering risks.  The second webinar examines the policy options for the US government and the private sector to address the risks of money laundering in the illicit gold trade and the effectiveness of ongoing policy measures.

https://gfintegrity.org/acfcs-gfi-webinar-inside-the-illicit-gold-trade/

RELYING ON DIGITAL ID FOR AML/CFT PURPOSES IN JERSEY AND GUERNSEY

On 5 August, an article from Walkers says that financial services regulators in Guernsey and Jersey have for several years officially recognised that regulated firms may, subject to appropriate safeguards, use electronic or digital means to meet their AML/CFT obligations to identify and verify the identities of their customers. Introducing a Client Alert, the article says that, in the last few months, lockdowns imposed around the world in response to the Covid-19 pandemic have made it highly impractical or impossible to verify customers’ identities by such means, which has brought digital systems for identification and verification of identity into focus, and may well accelerate the transition from paper based to digital systems as the default means of verifying identity.

https://www.walkersglobal.com/images/Publications/Advisory/2020/Global/Relying_on_Digital_ID_for_AML__CFT_purposes_in_Jersey_and_Guernsey.pdf

PODCAST – 1MDB: BRADLEY HOPE

In the latest TRACE podcast, Bradley Hope of the Wall Street Journal describes his team’s in-depth and ongoing research into Malaysia’s 1MDB scandal–and where Leonardo DiCaprio fits in.

https://traceinternational.org/resources-podcast

EU-VIETNAM TRADE AGREEMENT ENTERS INTO FORCE

On 31 July, a news release from the EU advised that the agreement that will ultimately scrap duties on 99% of all goods traded between the 2 parties.  It also says that doing business in Vietnam will also become easier for European companies: they will now be able to invest and pitch for government contracts with equal chances to their local competitors.

https://ec.europa.eu/commission/presscorner/detail/en/ip_20_1412

SON OF ITALY’S FORMER TOP MAFIA BOSS ARRESTED ON BRAZILIAN WARRANT

On 5 August, Reuters reported that Leonardo Badalamenti, 60, the son of the top boss of the Italian mafia in the 1970s, has been arrested in Sicily on an international warrant from Brazil.  A fugitive in Brazil since 2017, is wanted on charges of drug trafficking and bank fraud allegedly committed while living there under an alias.

https://uk.reuters.com/article/uk-italy-mafia/son-of-italys-former-top-mafia-boss-arrested-on-brazilian-warrant-idUKKCN2511OD

HONG KONG POLICE BUST LOAN SHARK SYNDICATE THAT TARGETED FILIPINO DOMESTIC WORKERS 

On 5 August, the South China Morning Post reported that victims would discover they owed inflated amounts and the syndicate made HK$23 million in loans between January 2019 and February 2020, according to police.

https://www.scmp.com/print/news/hong-kong/law-and-crime/article/3096183/hong-kong-police-bust-loan-shark-syndicate-targeted

US PRIVACY SHIELD: “WE’VE LOST THE EU BUT WE’VE STILL GOT SWITZERLAND!”

On 5 August, an article from Foley Hoag LLP says that, in the wake of the Schrems II CJEU decision invalidating the EU-US Privacy Shield, the US Commerce Department recently issued a set of FAQ, which go on at length about how the Swiss-US Privacy Shield is still in place and the steps that businesses can take to participate.

https://www.jdsupra.com/legalnews/privacy-shield-we-ve-lost-the-eu-but-we-45795/

THE RISE OF E-SPORTS BETTING

On 5 August, an article from Sheppard Mullin said that, while initially large-scale esports events were also cancelled, professional gaming competitions soon began taking place online. As one of the only professional “sports” competitions being broadcasted with any consistency, esports competitions filled the gap for many sportsbook operators. The article says that, while esports gambling is having a moment with no apparent slow-down on the horizon, only a return to normalcy will determine its place in the broader fabric of sports betting.

https://www.jdsupra.com/legalnews/the-rise-of-esports-betting-25093/

BRAZIL HUMANITARIAN LAW FEEDS ACTIVE BLACK MARKET IN VENEZUELA

On 5 August, an article in Insight Crime reported that food sent into Venezuela from Brazil under a law allowing it to be transported for humanitarian needs is being diverted to Venezuela’s black market.  Border authorities are also reportedly trying to take a cut of this lucrative contraband trade. A Brazilian decree was meant to allow Venezuelans to have access to food from Brazil, but it has mainly favoured government authorities, vendors with links to officials and members of the Bolivarian National Guard.

https://www.insightcrime.org/news/analysis/brazil-humanitarian-decree-venezuela/

AFTER SCHREMS II: THE FUTURE OF CROSS BORDER DATA FLOWS FOR THE INDUSTRIALS SECTOR

On 5 August, an article from Eversheds Sutherland says that if you transfer personal data from the EU/UK to countries which lack a so-called “adequacy” determination, like the US or India, or if your trusted service providers do, the Schrems II European Court decision has seismic significance — even if you do not rely on Privacy Shield. Examining the fallout, the article says that same logic, analysis and way forward for the Standard Contractual Clauses (which the Court appeared to “save” while rejecting the Privacy Shield) applies to those companies that rely on Binding Corporate Rules to transfer data to the US. The article urges businesses to examine what data transfers take place (or should take place) and the level of protection that exists or should exist.

https://www.eversheds-sutherland.com/global/en/what/articles/index.page?ArticleID=en/Diversified-industrials/The_Seismic_Shift_after_Schrems_II_The_Future_of_Cross_Border_Data_Flows_for_the_Industrials_Sector

AFTER SCHREMS II: THE IMPACT OF GDPR ON DATA FLOWS AND NATIONAL SECURITY

On 5 August, a post from VOX, the website of the Centre for Economic Policy Research, sets out to address the implications for adequacy and standard contractual clauses as well as the broader issue of how to balance national security and privacy goals. It concludes with observations about the potential impact of the decisions for the US and beyond and suggests some ways forward. It argues that what is needed is an international agreement on how to balance national security and access to data, with other key goals such as privacy. Such an outcome could be deemed an international agreement under GDPR.

https://voxeu.org/article/impact-gdpr-data-flows-and-national-security

BEIRUT’S DEVASTATING BLAST LINKED TO SEIZED RUSSIAN-OWNED CARGO SHIP

On 5 August, Rferl reported that media reports say a large supply of ammonium nitrate that exploded at a warehouse in the port of Beirut was likely unloaded there years earlier from a cargo ship that had been seized from its Russian owner, businessman Igor Grechushkin. The fertiliser had been stored at the dockside warehouse since it was confiscated from a cargo ship in 2014. The MV Rhosus was initially confiscated by Lebanese authorities in 2013 under an order by local inspectors in Beirut after it reportedly entered the port due to technical problems. It had been transporting ammonium nitrate from Batumi in Georgia to Mozambique.

https://www.rferl.org/a/reports-link-beirut-s-devastating-blast-to-russian-owned-cargo-ship/30767495.html

Reports on Hellenic Shipping News on 5 August also said that –

the explosion damaged the city’s largest grain elevator nearby and caused material damage to other structures in the area; and that beside the grain silos, a grain terminal was seen damaged in the explosion, according to various reports and analysts. The port handles 60% of all Lebanon imports.

https://www.hellenicshippingnews.com/explosion-at-port-of-beirut-damages-grain-silos-terminal-reports/

the wheat in Beirut’s port granaries cannot be used and that Lebanon will import wheat – the country said to currently have enough wheat until it begins importing it.

https://www.hellenicshippingnews.com/wheat-in-beiruts-port-granaries-not-usable-lebanon-will-import-wheat-economy-minister/

beirut

https://lloydslist.maritimeintelligence.informa.com/LL1133389/Beiruts-port-closed-after-huge-blast-death-toll-at-least-100

ISLE OF MAN: FSA ADVISES 3 CIVIL PENALTIES FOR INSURANCE COMPANIES FOR FAILURE TO COMPLY WITH REQUIREMENTS RE RISK ASSESSMENTS ETC

On 5 August, the FSA published 3 news releases advising that 3 separate insurance companies had seen civil penalties imposed – 2 quite modest, but with one (even after a 30% discount) of over £87,000.  The penalties related to failings in respect of a governance code and the AML/CFT Code, including failure to undertake or record adequately risk assessments, and ongoing CDD processes. In all 3 cases, the irregularities were aggravated due to the long-standing period of time over which non-compliance occurred and because a number of the matters identified by the FSA had previously been reported.

https://www.iomfsa.im/fsa-news/

FIREARMS EXPORTS TO BRAZIL SURGE AS GUN OWNERSHIP INCREASES UNDER BOLSONARO

On 31 July, the Guardian reported that firearms exports from Austria to Brazil have surged by more than 377% in the first half of this year as gun ownership increases under the President Bolsinaro. It is said that nearly 140,000 new guns had gone into circulation in Brazil in the first half of 2020 compared with just over 138,000 in the whole of 2018, and fewer than 84,000 in 2016.

https://www.theguardian.com/world/2020/jul/31/brazil-guns-glock-firearms-exports-data

SOMALIA ESTABLISHES OIL REGULATOR AS BIDS OPEN FOR FIRST LICENSING ROUND

On 5 August, Hellenic Shipping News reported that Somalia has set up the Somali Petroleum Authority to regulate the of its nascent oil sector and bids can be submitted up to 12 March 2021, for the 7 offshore oil blocks on offer. Oil exploration in Somalia began in the 1950s, but the civil war brought activity — both offshore and onshore — to a standstill.

https://www.hellenicshippingnews.com/somalia-establishes-oil-regulator-as-bids-open-for-first-ever-licensing-round/

US: COMPANY THAT HELPS TELEMARKETING BUSINESSES AVOID GETTING SUED FOR VIOLATING A FEDERAL LAW THAT SEEKS TO CURB ROBOCALLS SUFFERS DATA LEAK

In the Krebs on Security blog on 5 August it was reported that the company, the Blacklist Alliance, lost the phone numbers, email addresses and passwords of all its customers, as well as the mobile phone numbers and other data on people who have hired lawyers to go after telemarketers.

https://krebsonsecurity.com/2020/08/robocall-legal-advocate-leaks-customer-data/

PAKISTAN: GOVERNMENT AIMS TO PLUG LOOPHOLES LEADING TO “LEGAL” MONEY LAUNDERING

On 5 August, the Express Tribune reported that the government has moved to repeal a 28-year old law that facilitated billions of dollars money laundering and tax evasion every year, having been put in place for the purpose of “creating a liberal environment for savings and investments in Pakistan”. However, it was reportedly used by industrialists and politicians to “clean” illegal money, according to court records and statements.

https://tribune.com.pk/story/2258069/govt-aims-to-plug-loopholes-leading-to-legal-money-laundering

US DARKNET VENDOR AND COSTA RICAN PHARMACIST CHARGED WITH NARCOTICS AND MONEY LAUNDERING VIOLATIONS

A news release from the DoJ on 4 August advised that a dual US-Costa Rican citizen and a Costa Rican citizen, both of whom reside in Costa Rica, have been indicted by a federal grand jury for their illegal sales of opioids on the darknet.  It names David Brian Pate, 44, a US and Costa Rican citizen, and Jose Luis Fung Hou, 38, a Costa Rican citizen.  The indictment alleges that Pate illegally purchased narcotics, including OxyContin and morphine pills, primarily from Fung, a pharmacist in Costa Rica.  Pate would launder payments to Fung to purchase narcotics.  Pate then sold these narcotics on numerous darknet markets, including Silk Road and AlphaBay, in exchange for bitcoin.

https://www.justice.gov/opa/pr/american-darknet-vendor-and-costa-rican-pharmacist-charged-narcotics-and-money-laundering

GERMANY DISBANDS KSK SPECIAL FORCES COMPANY BECAUSE OF RIGHT-WING TENDENCIES

On 4 August, Janes.com reported that a company of the German Kommando Spezialkräfte (KSK) special forces was disbanded on 1 August. It is said to be part of a restructuring of the KSK due to rising right wing and anti-constitutional attitudes among its members since 2017 and 48,000 rounds of ammunition and 62 kg of explosives being unaccounted for by the KSK.

https://www.janes.com/defence-news/news-detail/germany-disbands-ksk-special-forces-company-because-of-right-wing-tendencies

THE INTEGRATED REVIEW: HARNESSING THE UK’S FINANCIAL CAPABILITIES IN SUPPORT OF NATIONAL SECURITY

On 5 August, a Briefing Paper from RUSI argues that the UK’s finance capabilities can – and should – contribute to a far greater extent to national security.  This comes as the UK government undertakes its Integrated Review of foreign policy, defence, security and international development to re-examine the UK’s priorities and objectives.

https://rusi.org/sites/default/files/integrated_review_bp_final_web_version.pdf

FREE-FOR-ALL ZONES: THE CASE OF DUBAI

On 5 August, an article from Global Financial Integrity refers to a report in July, Chaper 3 of which examined the role of free zones in Dubai as gateways for illicit financial flows and how a lax regulatory climate fosters a fertile environment for a multitude of illegal activities. It points out that some of the challenges with accurately mapping free zones anywhere in the world is the myriad names under which the free zones operate, as well as the absence of any international register, or even national register, of the zones. It then looks at Dubai –

  • some free zones in Dubai have websites while others do not, despite having been operational for over a decade;
  • some of the free zones are supposedly still under construction, but there are already companies operating out of them; and
  • some of the free zones have merged, while others have spawned free zones within free zones.

The article says that obfuscations such as these place significant limitations on the ability to accurately quantify and map free zones within the UAE.

https://gfintegrity.org/free-for-all-zones-the-case-of-dubai/

OFAC ENFORCEMENT CASES FOCUSED ON “SCREENING ERRORS”

In the second of a series of 3 articles, Michael Volkov says that in the last 2 years, OFAC has brought 4 enforcement actions that focus on an organisation’s “screening errors”.  These include American Express; Cobham Metalics; Apple; and Amazon.  This article reviews the cases involving American Express and Cobham Metalics.

https://www.jdsupra.com/legalnews/ofac-enforcement-cases-focused-on-47540/

OBLIGATIONS OF A BOARD MEMBER REGARDING THE FOREIGN CORRUPT PRACTICES ACT (FCPA)

On 5 August, an article from Thomas Fox seeks to answer a number of questions – what are the obligations of a Board member regarding the FCPA?; are the obligations of the Compliance Committee under the FCPA at odds with a director’s “prudent discharge of duties to shareholders”?; and do the words prudent discharge even appear anywhere in the FCPA?

http://fcpacompliancereport.com/2020/08/prudent-discharge-compliance-obligations-board/

IRELAND: FORMER SOLICITORS CHARGED WITH CONSPIRING TO DEFRAUD A NUMBER OF BANKS 

On 5 August, Echo Live reported that 2 former solicitors have appeared before Cork District Court charged with a fraud offence following a garda probe into the theft of sums, totalling several hundred thousand euros from a number of banks – by creating false identities for the purpose of obtaining credit dishonestly with the effect of causing financial loss to the banks.  Both accused are former solicitors who practiced as Keith Flynn & Company, the Capel Building, Mary’s Street in Dublin.

https://www.echolive.ie/corknews/Cork-court-Former-solicitors-charged-with-conspiring-to-defraud-a-number-of-banks–a83a469b-4559-4d1c-824e-693420a66b48-ds

FORMER VANUATU PM CONFIDENT OF BEATING CORRUPTION CHARGES

On 5 August, Radio New Zealand reported that the lawyer for former Vanuatu prime minister Charlot Salwai says his client is confident of winning a corruption trial in the Supreme Court.  Salwai, 2 former ministers and a former MP are to stand trial next month.  All are facing corruption and bribery charges while Salwai had also been charged with perjury.  It is alleged that in November 2016, the defendants bribed MPs to sign an ultimately failed motion of no confidence.

https://www.rnz.co.nz/international/pacific-news/422849/former-vanuatu-pm-confident-of-beating-corruption-charges

IRELAND: GARDAÍ SURRENDER 13 PEOPLE TO POLISH POLICE

On 5 August, the Irish Times reported that Gardaí have surrendered 13 people to the Polish police at Dublin Airport on European arrest warrants.  Another person was surrendered by the PSNI from Northern Ireland. These extraditions were sought by Polish Police in respect of a number of offences including sexual assault, attempted murder, fraud, extortion, assault, theft, kidnap and armed robbery.

https://www.irishtimes.com/news/crime-and-law/garda%C3%AD-surrender-13-people-to-polish-police-1.4323002

US: FORMER GUATEMALAN OFFICIAL WHO USED DRUG TRAFFICKING PROCEEDS AND OTHER DIRTY CASH TO BRIBE CORRUPT POLITICIANS CHARGED

On 5 August, a news release from the DoJ advised that former Economics Minister of Guatemala, Asisclo Valladares Urruela, 44, has been charged in Miami with helping to launder close to $10 million of illegal drug proceeds and other ill-gotten money. Prosecutors allege that during a 4-year conspiracy, he enabled the illegal drug trade by creating a demand for untraceable cash, cash that Valladares Urruela used to bribe corrupt Guatemalan politicians.

https://www.justice.gov/usao-sdfl/pr/former-guatemalan-official-who-used-drug-trafficking-proceeds-and-other-dirty-cash

https://www.dailymail.co.uk/wires/ap/article-8597837/US-charges-ex-Guatemala-economy-chief-money-laundering.html

MULTIPLE GROUPS INVOLVED IN OHIO $60 MILLION CORRUPTION SCHEME

On 5 August, AP reported that an FBI affidavit has detailed an alleged $60 million corruption scheme led by one of Ohio’s most powerful elected officials and provides painstaking detail about groups and individuals who played roles in spending mostly corporate cash.

https://apnews.com/efad17893e5dc06c935303f306566a20

US AIR FORCE PRODUCES FIRST 3D-PRINTED METAL PART FOR AIRCRAFT ENGINES

On 5 August, Flight Global reported that Tinker AFB maintenance personnel in Oklahoma City have produced and tested the first 3D-printed metal part on a USAF aircraft engine. They reverse engineered and reproduced an anti-ice gasket for the TF33 turbofan engine which powers the E-3 Sentry, B-52 Stratofortress and Northrop Grumman E-8.

https://www.flightglobal.com/fixed-wing/us-air-force-produces-first-3-d-printed-metal-part-for-aircraft-engines/139643.article

UK: HOW HAS CORONAVIRUS IMPACTED THE JUSTICE SYSTEM?

The Justice Select Committee of the House of Commons published on 5 August a report which highlighted –

  • 3 ways in which the pandemic has affected probation services in England & Wales – backlogs of work have built up; it has exacerbated already present staffing issues within the probation service; and it has created a very different environment for those released from prison to enter;
  • 3 ways it has affected prisons in England & Wales – the prison estate was placed in lockdown; the prison population needed to be reduced; and the prison population may rise again;
  • 3 ways that it has affected the courts in England & Wales – courts have rapidly adopted remote hearings in response to the COVID-19 pandemic; there has been a significant rise in the number of outstanding cases in the magistrates’ courts and the Crown Court; and every effort must be made to ensure there is effective public debate on the measures introduced; and
  • 3 ways it has affected the legal profession – less legal activity has meant less income for legal providers; legal professionals have adapted impressively quickly to working from home and holding and attending hearings remotely; and it is important that the legal professions are in good shape to deal with the increase in demand for legal advice and representation that is on the horizon.

The Committee has made its recommendations to Government, which now has 2 months to response.

https://houseofcommons.shorthandstories.com/justice-coronavirus-impact-on-probation-prisons-courts-legal-professions/index.html

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EWRA: ENHANCING THE ROBUSTNESS OF ENTERPRISE-WIDE RISK ASSESSMENT RE AML/CFT

The Monetary Authority of Singapore has issued an Information Paper which says that an “enterprise-wide money laundering and terrorism financing risk assessment” (EWRA) assesses a financial institution’s inherent money laundering and terrorism financing risks, the effectiveness of the control environment designed to mitigate those risks, and the need to implement additional measures to manage residual risks where necessary. The requirements and expectations pertaining to EWRA are laid out in MAS Notices and Guidelines.  The information paper sets out MAS’ supervisory expectation of effective EWRA frameworks and processes.  While the paper does not impose new regulatory obligations, it says that financial institutions should study the guidance to identify and address gaps in their EWRA frameworks and processes.  It includes case studies involving flawed EMRA methodology and good use of data.  Informed by reviews of institutions undertaken by MAS, the Paper says that an EWRA provides institutions with an overview of their risk exposure and forms the cornerstone of banks’ AML/CFT risk management.  A robust EWRA enables them to better understand their money laundering and terrorism financing risks, implement relevant policies and control procedures to effectively mitigate these risks, and optimise the allocation of AML/CFT resources.

https://media-exp1.licdn.com/dms/document/C561FAQH_fjLahnMLew/feedshare-document-pdf-analyzed/0?e=1596733200&v=beta&t=0yjUeA_Q38YNBUjWCy-tpNzlgs-U0Zyc2eKTxiFK2DQ

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REPORT: HOW ARE ORGANISED CRIME GROUPS INVOLVED IN SPORTS CORRUPTION?

A news release from Europol on 5 August advised that a new report highlights the link between sports corruption and organised crime: the characteristics of criminal networks, their structure and their modus operandi. In addition, the report analyses the different types of match-fixing as the most prominent form of sports corruption monitored by Europol. Football remains the most targeted and manipulated sport by international organised crime groups, it says, and individual sports competitions like tennis with a limited number of key participants (e.g. players and/or chair umpires) are an even easier corruption target for match-fixing gangs.

https://www.europol.europa.eu/newsroom/news/how-are-organised-crime-groups-involved-in-sports-corruption

The report is at –

https://www.europol.europa.eu/publications-documents/involvement-of-organised-crime-groups-in-sports-corruption

 

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UK AMENDS TERRORISM SANCTIONS ENTRY FOR QASEM SOLEIMANI

On 5 August, a Notice from HM Treasury advised that Soleimani has been removed from the Annex to EU Regulation 2580/2001/EC, but remains listed under the Terrorism and Terrorist Financing regime under the Terrorist Asset-Freezing etc. Act 2010 (TAFA).  He also remains listed under the Iran (Nuclear Proliferation) regime and continues to be subject to financial sanctions.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/907110/Notice_Terrorism2_2020_1128.pdf

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OFAC ADDS 1 INDIVIDUAL AND 1 ENTITY TO ZIMBABWE SANCTIONS LISTS, DELETING MANY OTHERS

On 5 August, OFAC issued a news release advising that Kudakwashe Regimond TAGWIREI, (aka Kuda TAGWIREI) and SAKUNDA HOLDINGS (aka SAKUNDA HOLDINGS PRIVATE LIMITED) had been added to its Zimbabwe sanctions lists.  At the same time a large number of persons were deleted from the lists – including the late John Bredenkamp and companies related to him.  Tagwirei is a Zimbabwean businessman with longstanding associations to the ruling party in Zimbabwe and high-level Government officials. He is said to have used his relationships to gain state contracts and receive favoured access to hard currency, including US dollars. In turn, he has provided high-priced items, such as expensive cars, to senior-level Zimbabwean government officials.

https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20200805.aspx

https://home.treasury.gov/news/press-releases/sm1082

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ISLE OF MAN: FINANCIAL SANCTIONS GUIDANCE FOR ENTITIES AND INDIVIDUALS OPERATING WITHIN THE MARITIME SHIPPING SECTOR

Dated 30 July, this new Sanctions Notice from the Customs and Excise Division in the Isle of Man sets out to provide comprehensive guidance for businesses in the Island.  It focuses on restrictions affecting Iran, Libya and Syria and details the various methods of evasion employed, as well as some due diligence steps that can be taken.

https://www.gov.im/media/1369886/sanctions-notice-54-maritime-financial-sanctions.pdf

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ISLE OF MAN CONFIRMS LIBYA, NORTH KOREA AND TERRORISM SANCTIONS UPDATES, AND ISSUES MARITIME SANCTIONS GUIDANCE

On 4 August, the Isle of Man published 4 news releases. 3 confirm amendments to 1 entry on Libyan sanctions lists, 37 entries on the North Korean sanctions lists and 20 entries on the terrorism sanctions lists.  The other news release announced the publication of new Sanctions Notice 54 providing guidance for entities and individuals operating within the maritime shipping sector.

https://www.gov.im/news/2020/aug/04/financial-sanctions-libya/

https://www.gov.im/news/2020/aug/04/financial-sanctions-democratic-peoples-republic-of-korea-north-korea/

https://www.gov.im/news/2020/aug/04/financial-sanctions-terrorism-and-terrorist-financing/

https://www.gov.im/news/2020/aug/04/maritime-sanctions-guidance/

Sanctions Notice 54 is available at –

https://www.gov.im/media/1369886/sanctions-notice-54-maritime-financial-sanctions.pdf

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OTHER THINGS YOU MAY HAVE MISSED – AUGUST 4

Panama Covid-19 update – though the graphs seem to show a levelling off of new infections in recent days/weeks, the figures remain worryingly high – 968 new cases added today, and 25 additional fatalities (taking us to 1,522 to date). 1,481 are hospitalised (161 in ICU0, with a total of 24,572 current active cases.  As noted before the vast majority of cases are in the 20 to 59 age ranges (i.e. over 74%), whereas only 11% are from the 60 to 79 age range

4 August 2020

SUMMARY OF THE IED COMPONENTS BAN AND REGULATIONS IN PLACE FOR EXPORTATION OF EXPLOSIVE MATERIALS TO SOMALIA

On 3 August, the UN Security Council published a summary of the IED components ban, imposed by paragraphs 26 to 28 of UN SCR 2498 (2019), and the regulations in place for exportation of explosive materials to Somalia.  The provisions include that if there is sufficient evidence to demonstrate that the item(s) will be used, or a significant risk they may be used, in the manufacture in Somalia of IED, the Council has decided that all States shall prevent the direct or indirect sale, supply or transfer of the item(s) to Somalia from their territories or by their nationals outside their territories, or using their flag vessels or aircraft.

https://www.un.org/securitycouncil/sites/www.un.org.securitycouncil/files/ian_3_english_final_3_august.pdf

INDIA CONSIDERING MEASURES TO PREVENT TRADE PARTNERS MAINLY IN SE ASIA FROM REROUTING CHINESE GOODS TO INDIA WITH LITTLE ADDED VALUE

On 4 August, Reuters reported that India is considering measures to prevent trade partners mainly in South-East Asia from rerouting Chinese goods to India with little added value, government sources said, amid strained ties with China and a push for self-reliance. The move will mainly target imports of base metals, electronic components for laptops and mobile phones, furniture, leather goods, toys, rubber, textiles, air conditioners and televisions, among other items, the officials said.  India’s trade ministry has already issued a notice to restrict inbound shipments of TV by requiring importers to get a special licence.

https://www.reuters.com/article/us-india-trade-asia/with-eye-on-china-india-looks-to-increase-barriers-on-imports-from-asia-idUSKCN24Z23B

SEIZED HUMAN HAIR PRODUCTS FROM XINJIANG PROVIDE EVIDENCE OF PERSECUTION

On 2 August, an article in the Epoch Times is concerned with US Customs having seized 13 tons of human hair products coming from the province of Xinjiang in July, this being followed later that month with the Commerce Department imposing sanctions on a Chinese hair accessory company. It is said that the seized hair comes from women lodged inside various concentration and labour camps in Xinjiang.

https://www.theepochtimes.com/seized-human-hair-products-from-xinjiang-provide-evidence-of-persecution_3445596.html

MEXICO’S CRIMINAL BRAZENNESS

On 3 August, an article was published by the Brookings Institute about Mexico’s collapsed law enforcement capacity, saying that the federal administration finally needs to recognise how frail the rule of law is in Mexico and start taking meaningful actions against Mexican criminal groups.

https://www.brookings.edu/blog/order-from-chaos/2020/08/03/mexicos-criminal-brazenness-matters

NORTH KOREAN SHIPS SPOTTED RETURNING TO OLD COLD SMUGGLING ROUTES NEAR VIETNAM

On 4 August, NK Pro reported that at least 10 ships linked to North Korea have been active at Vietnamese coal ports after the DPRK lifted COVID-19 quarantine measures. The movement of ships suggests that a smuggling route for sanctioned North Korean coal exports may be back in action, and that DPRK has not forgotten its Vietnamese coal clients and, like its other sea routes, is restarting normal business following an unprecedented recall and quarantine of most of its active fleet in March.

https://www.nknews.org/pro/north-korean-ships-spotted-returning-to-old-cold-smuggling-routes-near-vietnam/

 FREEZING ORDERS AND ASSET RECOVERY AFTER LITIGATION

On 24 July, an article from Rahman Ravelli was concerned with a a case that demonstrates the extent to which courts will award freezing orders to assist in asset recovery after litigation. The case saw a freezing order successfully preserved post-judgment by the claimant. The claimant was also granted a freezing order on a ‘Chabra basis’ against a non-party entity who was thought to be holding some of the defendant’s company assets.

https://www.rahmanravelli.co.uk/articles/freezing-orders-and-asset-recovery-after-litigation/

SECOND GUILTY PLEA IN LARGEST CYBERCRIME BUST IN US HISTORY

On 4 August, OCCRP published an article saying that a 30-year-old Moldovan national has pleaded guilty in a US court to participation in the Infraud transnational cybercrime organization that caused more than half a billion dollars in losses. Valerian Chiochiu, a programmer who went under various aliases including “Onassis,” “Flagler,” “Socrate,” and “Ecclesiastes,” was charged with conspiracy under the Racketeer Influenced and Corrupt Organizations Act (RICO) as a member of the international cybercrime group known as Infruad.

https://www.occrp.org/en/daily/12901-second-guilty-plea-in-largest-cybercrime-bust-in-us-history

PHILIPPINES: CUSTOMS OPERATIVES SEIZE SMUGGLED MCLAREN 620R SUPERCAR

On 3 August, Yahoo News reported that the Bureau of Customs recently seized a McLaren 620R super car at the Port of Manila. It was said to have been declared as a different car, a Porsche Cayman, to avoid duties and taxes.

https://sg.news.yahoo.com/customs-operatives-seize-smuggled-mclaren-000000349.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAACL0B6ntpBGw4ecKHvBvZ-YyRsGMA1VJvRjrpT-xttOl0HXgCM6XkX-vxUGvfjQ6EkxRl_fZ612SgDLBudV87ekBBPTnjI9TAqudV5NkjFVHP_9_lkMh5bbwSSIYgTxRiD-tgYKypgDlAWij4-dDv0gujK61fCSAc5f5beoOygUO

INTERPOL ASSESSMENT SHOWS ALARMING RATE OF CYBERATTACKS DURING COVID-19 PANDEMIC

A news release from Interpol on 4 August says that an assessment of the impact of COVID-19 on cybercrime has shown a significant target shift from individuals and small businesses to major corporations, governments and critical infrastructure – and criminals are also taking advantage of increased security vulnerabilities to steal data, generate profits and cause disruption.

https://www.interpol.int/News-and-Events/News/2020/INTERPOL-report-shows-alarming-rate-of-cyberattacks-during-COVID-19

7 ARRESTED IN POLAND IN LATEST STING AGAINST ILLEGAL TOBACCO

On 4 August, a news release from Europol advised that raids undertaken in Poland were part of an ongoing crackdown on an organised crime group running an illegal tobacco production line. This operation was initiated in June 2019 based on information on the movements of skilled workers and technicians from Ukraine to Poland. These workers were suspected of being involved in an illicit cigarette production line established on the Polish territory.

https://www.europol.europa.eu/newsroom/news/7-arrested-in-poland-in-latest-sting-against-illegal-tobacco

GERMANY: PROPOSED NEW LAW WILL STRENGTHEN ITS ABILITY TO HOLD EMPLOYEES OF COMPANIES CONNECTED TO GERMANY LIABLE FOR ACTS COMMITTED ELSEWHERE

On 4 August, an article from Out-Law said that the German government’s draft Corporate Sanctions Act would introduce corporate criminal liability in Germany and make enforcement action against companies mandatory. It provides incentives for compliance measures and the investigation and disclosure of compliance violations.  Employees with UK nationality acting in the UK may, under certain circumstances, already be criminally liable under German law, but this new law would increase that liability.

https://www.pinsentmasons.com/out-law/analysis/germany-to-strengthen-criminal-liability-for-acts-committed-in-uk

CHINA’S CENTRAL BANK HAS TAKEN THE LEAD IN DIGITAL CURRENCIES – WHAT DOES IT MEAN FOR BUSINESSES?

A post on the LSE Business Review blog on 4 August posed this question, saying the businesses can prepare by having digital wallets in place and planning interoperability for cross-border trade. It says that, as if Covid-19 and the US/China trade war hasn’t done enough to upend global business between the US and China, yet another major transformation is afoot: the launch of China’s sovereign (i.e., central-bank offered) digital currency (CBDC).

https://blogs.lse.ac.uk/businessreview/2020/08/03/chinas-central-bank-has-taken-the-lead-in-digital-currencies-what-does-it-mean-for-businesses/

LITHUANIA PLANS TO ESTABLISH AML COMPETENCE CENTRE

On 4 August, the Baltic Times reported that Lithuania plans to establish an AML competence centre as the Nordic and Baltic region has been hit by several money laundering scandals in recent years. The new centre’s operation would be funded from contributions of the central Bank of Lithuania and commercial banks.

https://www.baltictimes.com/lithuania_plans_to_establish_anti-money_laundering_competence_center/

GOLD IN SECRET VAULT IS TRACED TO HUGO CHÁVEZ’S FORMER NURSE

On 3 August, AP reported that, in 2014, Venezuela’s former treasurer was looking for a safe haven to store the unexplained wealth she had accumulated over the years. President Hugo Chávez, who she once served as a nurse, had recently died.  The former treasurer bought gold and a shell company established in St. Vincent and the Grenadines that she allegedly controlled purchased 250 gold bars valued at more than $9.5 million and allegedly stored at a private vault in Liechtenstein available to her and her son after his 18th birthday.  A few years later, a nearly identical amount of bullion was apparently sold, with much of the proceeds deposited into a Swiss bank. Those transactions are now at the centre of an international criminal investigation into the network of shell companies and dodgy Swiss bankers that have helped turn Venezuela into one of the most corrupt countries in the world.

https://apnews.com/4261ad628fc4e59518bf7cb6ed2f1f78

KENYA: ETHICS AND ANTI-CORRUPTION COMMISSION WIN IN A TUSSLE OVER ILLEGAL SALE OF GOVERNMENT LAND IN NAIROBI 

On 3 August, The Star reported that the Ethics and Anti-Corruption Commission had registered a big win in a tussle over illegal alienation of 53.4 acres of land in Nairobi which belongs to The Kenya Meteorological department which had been illegally issued to 5 companies.

https://www.the-star.co.ke/news/2020-08-03-win-for-eacc-as-court-revokes-title-deeds-given-to-private-firms-for-met-land/

YAOUNDE CODE OF CONDUCT TAKING SHAPE IN THE GULF OF GUINEA

On 4 August, Defence Web reported that the Yaoundé Code of Conduct was signed in 2013 by 25 countries in West and Central Africa. It provides the structure for joint operations, intelligence sharing and harmonized legal frameworks. The code includes 5 zones, 2 regional centre and 1 Interregional Coordination Centre (ICC) that watch over 6,000 km of coastline and 12 major ports. The Code aims to share information, coordinate action, strengthen laws and close down areas of vulnerability. The end goal will be to integrate the Gulf system into a continent-wide system as envisioned by the African Union. This 2050 Africa Integrated Maritime Strategy would have regional coordination centres encircling the continent and, eventually, a combined exclusive maritime zone that erases barriers and promotes trade.

https://www.defenceweb.co.za/security/maritime-security/yaounde-code-of-conduct-taking-shape-in-the-gulf-of-guinea/

THE RISE OF INVESTMENT SCREENING IN WESTERN EUROPE

An article from Control Risks says that in 2019 the EU passed legislation – due to come into force in October – to bring in a common approach for governments towards foreign investment in energy, ports and airports, and the communications and financial sectors. It says that the pandemic’s impact on economies and businesses has increased the political intent behind this. The devaluation of listed companies has made them more financially attractive to investors, and bankruptcies and insolvencies have left companies looking for inward investment, especially as government support schemes are wound down and banks tighten lending.

https://www.controlrisks.com/our-thinking/insights/the-rise-of-investment-screening-in-western-europe

MARITIME BUSINESSES FACE CHALLENGING CYBER THREATS AS GEOPOLITICAL TENSIONS RISE IN THE MEDITERRANEAN

On 20 July, Control Risks published an article saying that it has been closely monitoring the tense Eastern and Southern Mediterranean operating environments and the geopolitical drivers for cyber threats to businesses in the region. Its experts have identified a range of threats both to organisational assets, such as shipping and operational technology, and to personnel, driven by the geopolitical flashpoints between key actors in the region. It says that regional rivals focus on Syria, Cyprus, Libya and that geopolitical tensions translate to civilian cyber threats. It warns that espionage threats add to operational disruption, and that a growing range of threats highlight need for mitigation measures.

https://www.controlrisks.com/our-thinking/insights/maritime-businesses-face-challenging-cyber-threats

UK: MULTIPLE CHARITIES CLAIM THEY LOST OUT AFTER A SENIOR PARTNER AT LAW FIRM STOLE MILLIONS FROM CLIENTS’ ESTATES

On 4 August, Legal Futures reported that the charities, including the Church of England, are suing her, her former partner, the firm and its insurer. Linda Box, formerly senior partner of Wakefield law firm Dixon Coles McGill was jailed for 7 years in 2017 and, in 2018, she was was given a further 8 years after failing to repay £2.5 million of the estimated $4 million she had stolen.

https://www.legalfutures.co.uk/latest-news/charities-sue-over-senior-partners-theft-from-estates

UK: GOVERNMENT U-TURN ON ‘RACIALISING’ THE COURTS

On 4 August, the Law Society Gazette reported that the government has been forced into a U-turn over defendants being required to state their nationality at their first appearance before criminal courts. Senior judges and lawyers told ministers that collecting nationality information at the start of criminal cases breached privacy laws. Only defendants who are convicted and given a prison sentence will now be asked to give their nationality, for the purpose of possible deportation. The policy had been introduced as section 162 of the Policing and Crime Act 2017, as part of its ’hostile environment’ regime, with the aim of speeding up the removal of foreign criminals.

https://www.lawgazette.co.uk/news/government-u-turn-on-racialising-the-courts/5105271.article

INCREASE IN CYBERCRIME REPORTS IN THE BAHAMAS

On 4 August, the FATF-style regional body for the Caribbean, CFATF, published a notice saying that the Royal Bahamas Police Force has reported a 36% increase in hacking and extortion in The Bahamas. Between 1 January and 30 June, there were 118 cybercrime incidents reported to authorities, compared to the 87 matters reported during the same period in 2019. It says that the rise in cybercrime activity is not exclusive to The Bahamas, but a regional and global challenge during the ongoing COVID-19 pandemic.

https://www.cfatf-gafic.org/home/what-s-happening/664-increase-in-cyber-crime-reports-in-the-bahamas

UK: REPORT CALLS FOR TIGHTER CONTROLS ON OFFSHORE GAMBLING OPERATORS, STAKE LIMITS AND CAP ON LOSSES

On 4 August, the Guardian reported that a new report from the Social Market Foundation says that online gamblers should not be able to lose more than £100 a month without proving they can afford it, and also calls for betting websites that base themselves offshore to face stiffer taxes. The government has already pledged to review the law and the public policy thinktanks have called on ministers to consider redesigning the regulatory architecture it created.

https://www.theguardian.com/society/2020/aug/04/online-gamblers-should-prove-they-can-afford-losses-report-finds

SWISS AUTHORITIES CLAIM THAT GENEVA ART DEALER YVES BOUVIER EVADED TAX ON £276 MILLION IN ART

On 4 August, the Art Newspaper reported that he allegedly avoided paying Swiss taxes on CHF330 million on profits made from the sale of around CHF2 billion of art to the Russian collector Dimitry Rybolovlev, according to documents unsealed by Switzerland’s Federal Criminal Court. The documents had been seized in 2017 but Bouvier and his lawyers, had argued they should be kept sealed due to attorney-client confidentiality.

https://www.theartnewspaper.com/news/yves-bouvier-tax-evasion

CAPE VERDE AGREES TO EXTRADITE MADURO ALLY TO US

On 4 August, VOA reported that a court in Cape Verde has approved extradition of Colombian businessman Álex Saab to the US, where he faces charges involving money laundering on behalf of Venezuela’s socialist government.

https://www.voanews.com/africa/cape-verde-agrees-extradite-maduro-ally-us

FBI RAIDS US COMPANY WITH TIES TO UKRAINIAN OLIGARCH

On 4 August, BNN Bloomberg and others reported that a US company affiliated with the Ukrainian billionaire Igor Kolomoisky that has been accused of participating in an international fraud scheme was raided by the FBI in 2 locations – offices of Optima Management Group.

https://www.bnnbloomberg.ca/fbi-raids-u-s-company-with-ties-to-ukrainian-oligarch-1.1475409

https://www.news5cleveland.com/news/local-news/investigations/company-targeted-in-fbi-raid-in-downtown-cleveland-embroiled-in-separate-lawsuit-alleging-fraud

https://www.rferl.org/a/fbi-raids-offices-of-us-companies-belonging-to-ukrainian-tycoons/30766201.html

COLOMBIA’S SUPREME COURT HAS ORDERED THE ARREST OF FORMER PRESIDENT ALVARO URIBE FOR WITNESS TAMPERING

On 4 August, Colombia Reports said that the current president had confirmed the arrest warrant.  It is said that the Supreme Court did not immediately confirm whether he will go to jail or is to be allowed to await his fraud and bribery trial at home.

https://colombiareports.com/colombias-supreme-court-orders-uribes

PODCAST: IUU FISHING AND FISHING POLICY IN THE SOUTH CHINA SEA

On 2 August, the Center for International Maritime Security released a podcast which explores the complexities of Illegal, Unreported and Unregulated (IUU) fishing, its impact, how different countries are approaching the enforcement challenge, and its impact on coastal communities.

http://cimsec.org/sea-control-192-iuu-fishing-and-fishing-policy-in-the-south-china-sea/45095

 

 

 

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THE GLOBAL SANCTIONS DATA BASE

On 4 August, VOX, the website for Centre for Economic Policy Research, published an article which introduces a new dataset of economic sanctions that covers all bilateral, multilateral, and plurilateral sanctions in the world from 1950 to 2016 that can be utilised to analyse sanctions policies.

https://voxeu.org/article/global-sanctions-data-base

https://www.globalsanctionsdatabase.com/

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LEBANESE HEZBOLLAH INTERACTIVE MAP

The Washington Institute for Near East Policy on 3 August produced an interactive map (and videos) and saying that Lebanese Hezbollah is a global, multifaceted organisation, engaged in a wide range of endeavours, including overt social and political activities in Lebanon, military activities in Lebanon, Syria, and throughout the Middle East, and covert militant, criminal, and terrorist activities around the world.  Hezbollah is very public about its social and political activities, but the group goes to great lengths to conceal its covert and illicit pursuits. The Institute has produced an interactive multimedia tool, the map is searchable by category, location, timeline, and text keywords. Each entry includes photographs or videos, a summary of the event, geographic and/or thematic linkages to other related entries in the map, as well as primary-source documents. As a “living” project, the digital interface will be updated as more information and documentation becomes available.

https://www.washingtoninstitute.org/hezbollahinteractivemap/

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3 EXECUTIVES FROM GUAM AND NORTHERN MARIANA ISLANDS INDICTED FOR RICO CONSPIRACY, HARBORING ILLEGAL ALIENS, UNLAWFUL EMPLOYMENT OF ALIENS, AND INTERNATIONAL PROMOTIONAL MONEY LAUNDERING

A news release from the US DoJ on 4 August advised that 3 executives from Imperial Pacific International (IPI) and MCC International Saipan have been indicted, accused of utilising criminal labour practices during ongoing construction of the Grand Mariana Casino Hotel and Resort on the island of Saipan.  The defendants are further alleged to have transferred over $24 million into the US to promote their illegal activity.

https://www.justice.gov/opa/pr/imperial-pacific-international-and-mcc-international-saipan-executives-indicted-federal

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SECOND GUILTY PLEA IN LARGEST CYBERCRIME BUST IN US HISTORY

On 4 August, OCCRP published an article saying that a 30-year-old Moldovan national has pleaded guilty in a US court to participation in the Infraud transnational cybercrime organisation that caused more than half a billion dollars in losses. Valerian Chiochiu, a programmer who went under various aliases including “Onassis,” “Flagler,” “Socrate,” and “Ecclesiastes,” was charged with conspiracy under the Racketeer Influenced and Corrupt Organizations Act (RICO) as a member of the international cybercrime group known as Infruad. 

https://www.occrp.org/en/daily/12901-second-guilty-plea-in-largest-cybercrime-bust-in-us-history

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FORMER OMBUDSMAN OF PANAMA SENTENCED TO 8 YEARS IN PRISON FOR CORRUPTION

On 4 August, Explica and others reported that Patria Portugal, the first woman to have held the position of Ombudsman in Panama during 2011-2013, has been found guilty and sentenced to 8years in prison for embezzlement.

https://www.explica.co/former-ombudsman-of-panama-sentenced-to-8-years-in-prison-for-corruption/

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UK OPEN GENERAL EXPORT LICENCES REVISED AND REVOKED

 

On 4 August, the UK Department of International Trade published Notice to Exporters 2020/13 which advised that 20 open general export licences (OGEL), 1 open general transhipment licence (OGTL) and 1 open general trade control licence (OGTCL) that include Hong Kong have been changed or amended to bring them in line with restrictions on China.

https://www.gov.uk/government/publications/notice-to-exporters-202013-open-general-licences-revised-and-revoked/notice-to-exporters-202013-open-general-licences-revised-and-revoked

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OTHER THINGS YOU MAY HAVE MISSED – AUGUST 3

Panama Covid-19 update – it seems the mayor of Panama City is to face charges after being caught breaking the curfew by heading for the beach…

mayor

Meanwhile, another 1,003 new cases means no sign in levelling off or falling, there being 24,866 active cases (but 42,093 now having recovered).  26 fatalities, giving a total as of today – Day 148, of 1,497.  There remains 1,482 people in hospital – 165 in ICU, with 22,703 in self-isolation at home.

3 August 2020

US CUSTOMS OFFICIALS PLAN RULING TO GIVE BORDER AGENTS MORE TRANSPARENCY ABOUT THE ORIGIN OF IMPORTS TO POLICE SHIPMENTS FOR COUNTERFEITS AND OTHER ILLEGAL GOODS

On 3 August, the Wall Street Journal reported that officials plan to issue a ruling intended to give border agents more transparency about the origin of imports destined for US warehouses, improving their ability to police shipments for counterfeits and other illegal goods. It aims to clarify what information some shippers must include about shipments valued at less than $800 that are heading to US fulfilment centre and warehouses.  The $800 threshold was set in 2016 as the amount at which goods can pass into the US tax-free and with minimal documentation.

https://www.wsj.com/articles/customs-ruling-to-boost-ability-to-identify-counterfeit-shipments-11596427261

https://www.cbp.gov/newsroom/national-media-release/cbp-enhances-accountability-e-commerce-through-ruling-duty

UK: SANCTIONS AND TRANSPORT

On 3 August, a post on the OFSI Blog which saws that, while OFSI plays its part in the implementation of financial sanctions, where does the Department for Transport (DfT) fit in to this picture? It says that to ensure ship and aircraft sanctions prohibitions can be enforced within UK waters, UK airspace, or wherever there is an applicable UK connection, DfT works closely alongside the Maritime and Coastguard Agency (MCA), the Civil Aviation Authority (CAA) and National Air Traffic Service (NATS). Countries which are currently subject to transport sanctions under UN and EU measures are DPRK, Libya, Russia and Syria.

https://ofsi.blog.gov.uk/2020/08/03/sanctions-and-transport/

$340 MILLION IN LONDON LAW FIRM’S ACCOUNT SUSPECTED OF 1MDB CONNECTION

On 3 August, the Guardian reported that investigators have said they suspect $340 million held in the bank account of a major London law firm Clyde & Co is linked to money allegedly embezzled from the Malaysian state investment fund 1MDB. The money is said to be linked to a Saudi businessman, Tarek Obaid, who US and Malaysian prosecutors have alleged is implicated in the fraud against 1MDB.

https://www.theguardian.com/world/2020/aug/03/340m-in-london-law-firms-account-suspected-of-1mdb-connection

PODCAST: PRIVATE MILITARY AND SECURITY CONTRACTORS AND THEIR ROLE IN REMOTE WARFARE

On 10 July, the Oxford Research Group released this podcast in which Christopher Kinsey and Helene Olsen from King’s College London join the podcast to discuss private military and security contractors and their role in remote warfare.

https://www.oxfordresearchgroup.org.uk/warpod-ep-17-remote-warfare-and-private-military-and-security-contractors

See also: Remote Warfare and the Utility of Military and Security Contractors –

https://www.e-ir.info/pdf/85423

US CUSTOMS AND THE JONES ACT – OFFSHORE WIND FARM INSTALLATION GUIDANCE

On 30 July, Winston & Strawn LLP published an article about guidance issued on 15 July on the installation of offshore wind farms in U.S. waters.  It explains that the “Jones Act” is the term for a group of laws which restrict certain activities in US waters to qualified US-flag vessels. Similar laws apply to the transportation of “passengers” as well as dredging, fishing and towing in defined US waters. In the ruling, CBP confirmed the well-understood maxim that a foreign installation vessel can install wind tower components so long as the vessel is stationary and does not “transport” components but is provided those components from shore via Jones Act qualified “feeder” vessels. It also clarified that “vessel equipment” is not “merchandise” and therefore can be transported by a foreign vessel between 2 “points in the United States”.  The article also proposes that a foreign vessel would only be prohibited from the transportation of crews from one work site to another if such persons were considered “passengers” rather than “crew”.

https://www.winston.com/en/maritime-fedwatch/us-customs-issues-offshore-wind-farm-installation-guidance.html#page=1

POCA DISCLOSURE ORDERS, NOTICES AND OVERSEAS RECIPIENTS

On 30 July, an article from the chambers at 5 St Andrews Hill was concerned with the recent High Court case of Faerman, in which the Court considered an application to discharge a disclosure order. SFO was conducting a civil recovery investigation into assets held by Mr Faerman, a Brazilian national, to decide if those assets had been obtained through unlawful conduct and, as part of the investigation, it had made an application for a disclosure order under the Proceeds of Crime Act 2002. The application argued that the court had no jurisdiction to grant the disclosure order as it only named Faerman as a respondent and he was resident outside of the jurisdiction, and that failure to bring a relevant Supreme Court decision on such matters to the attention of the court amounted to material non-disclosure. However, the High Court did not therefore consider the disclosure order itself was unauthorised or defective – the order could be sent to persons within the UK, despite Faerman being the only named respondent. However, there was no power to issue a notice requiring information from Faerman, who was resident in Brazil. The Court did criticise the process adopted by the SFO and withheld a costs orders as a result.

https://www.5sah.co.uk/news-and-events/articles/2020-07-30/poca-disclosure-orders-notices-and-overseas-recipients-faerman-v-sfo-james-fletcher-for-lexis-nexis

UK PUBLISHES SANCTIONS COMPLIANCE GUIDANCE FOR THE MARITIME INDUSTRY

An article from Reed Smith on 30 July is concerned with the release on by OFSI on 27 July of 12-page financial sanctions guidance for entities and individuals operating within the maritime shipping sector. This identifies a number of illicit and suspicious shipping practices – and provides an overview of the restrictions in place in respect of what it terms “High-profile sanctions” for North Korea, Iran, Libya and Syria, and clarifies the approach taken to a number of key definitions for the purposes of UK sanctions, including ownership and control and funds and economic resources.

https://www.reedsmith.com/en/perspectives/2020/07/uk-publishes-sanctions-compliance-guidance-for-the-maritime-industry

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/903901/OFSI_-_Maritime_guidance__July_2020_.pdf

UK SHIPPING SANCTIONS GUIDE SHOWS CLOSER ALIGNMENT TO US

Lloyds Loading List take on the new UK sanctions guidance on 31 July is that the UK seems set to take a tougher US-style approach to maritime sanctions in the wake of Brexit, lawyers believe, following the issue of new guidelines from OFSI.

https://lloydslist.maritimeintelligence.informa.com/LL1133345/UK-shipping-sanctions-guide-shows-closer-alignment-to-US

IRAN APPLIES SANCTIONS TO FORMER ADVISER TO US NATIONAL SECURITY COUNCIL

On 3 August, the EU Sanctions Blog reported that the Iranian government has designated US national Richard Goldberg, a former official of the NSC and aide to John Bolton, and is currently a senior advisor at the Foundation for the Defence of Democracies, which was itself listed by Iran in September 2019.

https://www.europeansanctions.com/2020/08/iran-sanctions-former-advisor-to-us-national-security-council/

https://www.middleeastmonitor.com/20200803-iran-imposes-sanctions-on-ex-us-security-council-member/

HOW ISIS TURNED FACEBOOK INTO A GLOBAL MARKETPLACE FOR LOOTED ARTIFACTS

On 2 August, Defense One published an article saying that Islamic State turned the social platform into a global marketplace for looted artifacts — until a group of vigilante archaeologists took matters into their own hands.

https://www.defenseone.com/ideas/2020/08/how-isis-made-money-facebook/167374/

ISLE OF MAN CONFIRMS BRYAN D’ANCONA ADDED TO ISIL/AL-QAIDA SANCTIONS LIST

A news release on 3 August confirmed that this French national had been added to the relevant sanctions lists and was therefore subject to an asset freeze.

https://www.gov.im/news/2020/aug/03/financial-sanctions-isil-daesh-and-al-qaida/

ISLE OF MAN CONFIRMS 6 INDIVIDUALS AND 3 ENTITIES SUBJECT TO SANCTIONS UNDER EU CYBER ATTACKS REGULATION

A news release on 3 August confirmed the addition of 6 named individuals and 3 entities to sanctions under EU Regulation 2019/796/EU.

https://www.gov.im/news/2020/aug/03/financial-sanctions-cyber-attacks/

UAE BECOMES THE FIRST ARAB COUNTRY TO LAUNCH ITS OWN NUCLEAR ENERGY PROGRAMME

CNBC on 3 August reported that UAE is the first new country to launch a nuclear power plant in 3 decades, the last being China in 1990.  The Barakah plant’s Unit 1 is the first of the country’s planned 4 reactors, which when complete are expected to meet 25% of the country’s electricity needs with zero carbon emissions, and with the successful start-up of its Barakah nuclear energy plant.

https://www.cnbc.com/2020/08/03/uae-becomes-first-arab-country-to-launch-local-nuclear-energy-program.html

COSTA RICA: SMUGGLING AND COUNTERFEITING HAS INCREASED IN THE COUNTRY BY 42% DURING THE COVID-19 CRISIS

Costa Rica News reported that COVID-19 not only changed social interactions and the economy in Costa Rica, but also the dynamics of criminal organizations who engage in contraband, counterfeiting and other forms of illegal trade. An increase of 42% in the total of products seized during the first half of 2020 (with 16,301,243 units seized), compared to the same period in 2019.

https://thecostaricanews.com/smuggling-and-counterfeiting-has-increased-in-the-country-by-42-during-the-covid-19-crisis/

INSIDE A CRYPTO ‘PONZI’: HOW THE $6.5 MILLION BANANA.FUND FRAUD UNRAVELLED

On 3 August, NASDAQ reported that US prosecutors are seeking to return $6.5 million in allegedly scammed bitcoin to victims of the “Banana.Fund” crowdfunding project, which the US government described in court papers as a Ponzi scheme. A lawsuit filed in Washington DC seeks to grant the federal government formal ownership of the assets so it can return them to the victims. The fund was described as a business development company which shepherded fledgling start-ups through their earliest stages while offering operational transparency to their seed investors.

https://www.nasdaq.com/articles/inside-a-crypto-ponzi%3A-how-the-%246.5m-banana.fund-fraud-unravelled-2020-08-03

https://www.linkedin.com/posts/timoalloyd_acams-acfcs-cryptocurrency-activity-6694657724682260480-qhYv

ALBANIAN ASSOCIATION OF BANKS CRITICISES DRAFT LAW ON FISCAL AMNESTY OVER MONEY LAUNDERING CONCERNS

Exit News on 3 August reported that the Association has levied criticism against the draft law which will allow the deposit of undeclared assets and income into Albanian banks without fiscal obligations, the need to disclose the source, and without criminal liability. The proposed law will also allow ex-state officials and politicians who left their position 3 years or more ago, to benefit from the amnesty. The Association says that it creates the conditions for money laundering to take place.

https://exit.al/en/2020/08/03/albanian-association-of-banks-criticises-draft-law-on-fiscal-amnesty-over-money-laundering-concerns/

NIGERIA’S GROWING INSECURITY OFFERS EXPANSION OPPORTUNITIES FOR BOKO HARAM

On 3 August, Defence Web reported that Boko Haram is extending its reach from north-east Nigeria into the country’s north-west. It is taking advantage of old and new local conflicts and insecurities to further embed itself in the area through violent extremism. The article warns that humanitarian fallout from Boko Haram attacks will only increase. This will lead to a diversion of resources that could instead have been used in developing the affected communities and improving citizens’ lives.

https://www.defenceweb.co.za/security/national-security/iss-nigerias-growing-insecurity-offers-expansion-opportunities-for-boko-haram/

EX-DEUTSCHE BANK TRADERS ACCUSED OF SPOOFING OPPOSE ADMISSION OF CO-CONSPIRATOR STATEMENTS AT TRIAL

On 3 August, Finance Feeds says that former Deutsche Bank precious metals traders James Vorley and Cedric Chanu, who are accused of spoofing, have replied to a motion by the US Government regarding admission of a co-conspirator statements at trial.

https://financefeeds.com/ex-deutsche-bank-traders-accused-spoofing-oppose-admission-co-conspirator-statements-trial

SOUTH AFRICA: PUBLIC PROTECTOR INVESTIGATING COVID-19 CORRUPTION, MISCONDUCT

On 3 August, All Africa reported that the Office of the Public Protector says it has been inundated by complaints of suspected misconduct and service delivery failure in the last 4 months.

https://allafrica.com/stories/202008030912.html

SOUTH AFRICA: ESKOM GOES TO COURT TO RECOVER BILLIONS FROM FORMER EXECUTIVES AND GUPTAS

On 3 August, IOL reported that Eskom and the Special Investigating Unit (SIU) have instituted legal proceedings to recoup monies from the power utility’s former executives, the Guptas and associates lost to state capture corruption.

https://www.iol.co.za/news/politics/eskom-goes-to-court-to-recover-billions-from-former-executives-guptas-9fa5da35-057d-4d11-8e3e-1e250dfd50e8

THE PERCEPTION OF CHINA IN AFRICA REMAINS COMPLEX AND MULTIFACETED

On 3 August, a Commentary from RUSI says that part of the complexity is the multiplicity of Chinese players with different agendas. For instance, the Chinese government has a specific agenda to gain global influence, while Chinese state-owned enterprises remain closely aligned with the state but aim to maximise profit. Entrepreneurs, philanthropists and individual citizens all contribute to different views of China in Africa. It looks at the forces shaping the perception of China – skills development, training and scholarships; high-level political commitments to friendship and solidarity; development finance

https://rusi.org/commentary/china-africas-looking-glass-perceptions-and-realities

INTERNAL INVESTIGATIONS – GETTING THE BASICS RIGHT

On 31 July, Control Risks published an article saying that the exceptional circumstances related to COVID-19 have required investigators to think creatively about how they will conduct investigations when much of the workforce is working remotely and social distancing restrictions are in place. This creativity is necessary to ensure that critical information can be obtained when long-standing investigative processes – physical site visits, in-person interviews, review of original documents – are not consistently available. When developing these solutions, it is important that investigators adhere to certain general investigation principles to ensure a conducive and transparent process.

https://www.controlrisks.com/our-thinking/insights/internal-investigations-getting-the-basics-right

ARGENTINA CASINO SHUTDOWN ALLOWING ILLEGAL GAMBLING RINGS TO THRIVE

On 3 August, Insight Crime reported that authorities in Argentina have implicated police and prosecutors in an illegal gambling ring linked to the infamous Los Monos crime group, underscoring how the coronavirus pandemic has provided yet more opportunity for official corruption.  Among those accused are former police chief Alejandro Torrisi, who was arrested exiting an illegal casino with an envelope of cash in hand. In March, Argentina closed down its legal casinos as part of the coronavirus lockdown, a move that appears to have driven gamblers to illegal alternatives.

https://www.insightcrime.org/news/brief/argentina-gambling-rings/

COURT VICTORY WATERSHED MOMENT FOR CORPORATE ACCOUNTABILITY IN SOUTH-EAST ASIA

On 3 August, an article on Ekklesia reported that the Bangkok South Civil Court granted Class Action Lawsuit status to more than 700 Cambodian families who are suing Thai sugar giant Mitr Phol after being forcibly evicted from their homes in 2008-09.

http://www.ekklesia.co.uk/node/29835

WHAT ARE SWIFT CODES?

On 28 July, a post in Modern Treasury explained briefly what SWIFT Codes are, and how to find a SWIFT Code, how an International Wire Transfer works.

https://www.moderntreasury.com/journal/what-are-swift-codes

MALTA: ECB CANCELS SATABANK LICENCE FOLLOWING RECOMMENDATION BY MFSA

In the July edition of the Malta Financial Services Oversight Newsletter, an article briefly lays out the Satabank affair.  In June, the European Central Bank revoked Satabank’s banking licence following a recommendation from the MFSA. The recommendation came on the back of serious AML/CFT failings which were identified in a joint supervisory operation led by the FIAU and which resulted in a record penalty of over €3.7 million issued by the FIAU in

March 2019.

https://mfin.gov.mt/en/Newsletters/Documents/GOV_NEWSLETTER_JUL_2020.pdf

MALTA: PROGRESS IN COMPLIANCE WITH MONEYVAL AND AML/CFT REQUIREMENTS

The July edition of the Malta Financial Services Oversight Newsletter contains a brief article summarising steps taken by Malta and its institutions in meeting the recommendations made by the Moneyval team in 2019.

https://mfin.gov.mt/en/Newsletters/Documents/GOV_NEWSLETTER_JUL_2020.pdf

IRAN LEARNING FROM HOUTHI USE OF MISSILES, DRONES IN YEMEN – A PREVIEW OF FUTURE CONFLICTS

On 2 July, an article in The Media Line reports that analysts say attacks on Saudi Arabia by Shi’ite rebels represent a preview of future conflicts. Iran-backed Houthi rebels in Yemen are getting more brazen in their use of ballistic missiles and drones, and analysts say that this could be a preview of future conflicts involving key regional players in the Middle East, as well as superpowers such as the US.

https://themedialine.org/by-region/iran-learning-from-houthi-use-of-missiles-drones-in-yemen

arms

https://www.armscontrol.org/75Years

EU COMMISSION PROPOSES TO AMEND VAT RULES TO ACCOMMODATE TRADE WITH NORTHERN IRELAND AFTER THE BREXIT TRANSITION PERIOD

On 31 July, the EU proposed changes to the EU’s VAT rules, in preparation for the end of the transition period with the UK.  The new amendment to the EU VAT Directive introduces a special identification VAT number for businesses in Northern Ireland, so that EU VAT provisions can be properly applied to goods, in line with the Protocol on Ireland/Northern Ireland. Under the Protocol, EU VAT legislation will continue to apply when it comes to goods traded in Northern Ireland. This means, amongst other things, that goods sold and transported from Northern Ireland to the EU (and vice-versa) will be treated the same as cross-border supplies of goods within the EU, including for VAT exemptions and deductions.

https://ec.europa.eu/taxation_customs/news/commission-proposes-amend-vat-rules-accommodate-trade-northern-ireland-after-transition-period_en

ALBANIAN BUSINESSMAN’S ASSETS SEIZED, DRUG LINKS SUSPECTED

On 3 August, AP reported that Albanian prosecutors said they had seized vast assets belonging to Ylli Ndroqi (aka Xhemal Pasmaciu) a businessman and a media mogul suspected of building his empire with profits from drug trafficking. Ndroqi had previously sued the mayor of Tirana for defamation, after the mayor accused staff members at Ndroqi’s media holdings of corruption. Ndroqi says his employees are under attack because they have exposed corruption cases involving public officials.

https://apnews.com/73fbef820c51566c59770e97451cedde

FORMER SPANISH KING JUAN CARLOS ‘LEAVES COUNTRY’ AMID CORRUPTION SCANDAL

LBC and others reported on 3 August that the 82-year-old had written to his son and successor, King Felipe VI, to say he had decided to move into exile.

https://www.lbcnews.co.uk/world-news/spain-king-juan-carlos-leaves-country-corruption-scandal

MALTA: INTERVIEW WITH DIRECTOR OF FIAU

On 30 July, the Malta Business Observer published a 2-page interview with Kenneth Farrugia, Director of the FIAU, about the change made to the Unit as it seeks to meet the recommendations and criticisms of the last MONEYVAL assessment, and cope with the fallout from the various scandals that have wracked the island in recent years.

https://media-exp1.licdn.com/dms/document/C4D1FAQEM_geYCk6aVw/feedshare-document-pdf-analyzed/0?e=1596582000&v=beta&t=X9Hvgz6sHEroQntKTO5li5ybAk3PQ852WoPmnaU-YuI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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GIBRALTAR: AML/CFT NATIONAL RISK ASSESSMENT

On 3 August, Gibraltar published its NRA, saying that this is the third iteration of the process and in the 2020 version has encapsulated proliferation financing as a separate topic and included the previously confidential assessment of terrorism financing risk for the jurisdiction and non-profit organisation sectors as an integral part of the published NRA report. The terrorism financing risk for each product or service is also fully integrated into the evaluation of the threats and vulnerabilities.  The executive summary highlights the main risks which businesses and professions need to be aware of in the context of Gibraltar.  In summary tables, a marking system is used to indicate risk and vulnerability to arrive at a risk score for each business sector.

The full NRA is at –

https://gfiu.gov.gi/uploads/Ihhoj_2020_NRA_Final.pdf

and executive summary at –

https://gfiu.gov.gi/uploads/TqiZr_2020_National_Risk_Assessment_Executive_Summary_FI.pdf

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UK: 20 ENTRIES ON TERRORISM SANCTIONS LISTS AND 37 ON NORTH KOREAN SANCTIONS LISTS AMENDED

On 3 August, 2 Notices from HM Treasury advised that –

  • Following EU Regulation 2020/1128/EU, 20 entries subject to sanctions in relation to terrorism have been amended on the Consolidated List and remain subject to an asset freeze; and
  • Following EU Regulation 2020/1129/EU, 37 entries subject to sanctions in relation to North Korea have had identifying information amended and remain subject to financial sanctions.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/906381/Notice_Terrorism_2020_1128.pdf

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/906373/Notice_DPRK_2020_1129.pdf

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AFRICA’S COLOURED GEMSTONE TRADE FLOWS TO ASIA – AND CRIME AND CORRUPTION

On 31 July, an article from the Global Initiative Against Transnational Organised Crime says that the coloured gemstone sector is an international trade linking supply countries in Africa and traders in Thailand and elsewhere in Asia. Today, it says, there are more than 50 source countries and over a hundred gemstone varieties. In 2015, the sector was valued at between $17 billion and $23 billion. The rough stones are shipped mainly to Thailand, India and Sri Lanka. The article warns that the informal nature of the trade, combined with the inherent difficulty in valuing rough stones at the site of extraction, provides ample opportunity for criminal and corrupt actors to exploit and profit from it. The report is available at –

https://globalinitiative.net/wp-content/uploads/2020/07/A-Rough-Cut-Trade-Africa%E2%80%99s-Coloured-Gemstone-Flows-to-Asia-GITOC.pdf

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WHY AND HOW GROUPS FROM THE WESTERN BALKANS HAVE BECOME ENGAGED IN ORGANISED CRIME IN SOUTH AFRICA, TURKEY, AUSTRALIA AS WELL AS IN SOME COUNTRIES OF LATIN AMERICA AND WESTERN EUROPE

On 24 July, an article from the Global Initiative Against Transnational Organised Crime about a report shows that criminal groups from the Western Balkans operating abroad are modern, dynamic and entrepreneurial, and have demonstrated an ability to adapt and innovate and use technology to their advantage (e.g. using encrypted forms of communication; exploring new routes and means of trafficking, such as ‘narco-jets’; and laundering their money through cryptocurrencies, offshore havens and into their home countries). The report suggests that there is not a ‘Balkan Cartel’ per se, although groups from the region sometimes work with each other, and there are also instances of multi-ethnic groups. The report calls for more effective law enforcement cooperation, tracking and seizing of assets, and the sharing of information, not least since perpetrators tend to use multiple identities. It also stresses the need to reduce demand for the goods and services provided by criminal groups from the Western Balkans.

https://globalinitiative.net/transnational-tentacles-wb6/

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UK PUBLISHES SANCTIONS COMPLIANCE GUIDANCE FOR THE MARITIME INDUSTRY – SHOWS CLOSER ALIGNMENT TO US

UK PUBLISHES SANCTIONS COMPLIANCE GUIDANCE FOR THE MARITIME INDUSTRY

An article from Reed Smith on 30 July is concerned with the release on by OFSI on 27 July of 12-page financial sanctions guidance for entities and individuals operating within the maritime shipping sector. This identifies a number of illicit and suspicious shipping practices – and provides an overview of the restrictions in place in respect of what it terms “High-profile sanctions” for North Korea, Iran, Libya and Syria, and clarifies the approach taken to a number of key definitions for the purposes of UK sanctions, including ownership and control and funds and economic resources.

https://www.reedsmith.com/en/perspectives/2020/07/uk-publishes-sanctions-compliance-guidance-for-the-maritime-industry

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/903901/OFSI_-_Maritime_guidance__July_2020_.pdf

UK SHIPPING SANCTIONS GUIDE SHOWS CLOSER ALIGNMENT TO US

Lloyds Loading List take on the new UK sanctions guidance on 31 July is that the UK seems set to take a tougher US-style approach to maritime sanctions in the wake of Brexit, lawyers believe, following the issue of new guidelines from OFSI.

https://lloydslist.maritimeintelligence.informa.com/LL1133345/UK-shipping-sanctions-guide-shows-closer-alignment-to-US

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INTERNAL INVESTIGATIONS – GETTING THE BASICS RIGHT

On 31 July, Control Risks published an article saying that the exceptional circumstances related to COVID-19 have required investigators to think creatively about how they will conduct investigations when much of the workforce is working remotely and social distancing restrictions are in place. This creativity is necessary to ensure that critical information can be obtained when long-standing investigative processes – physical site visits, in-person interviews, review of original documents – are not consistently available. When developing these solutions, it is important that investigators adhere to certain general investigation principles to ensure a conducive and transparent process.

https://www.controlrisks.com/our-thinking/insights/internal-investigations-getting-the-basics-right

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IRELAND: STATEMENTS OF TRUTH ARE ON THE WAY

On 31 July, McCarthy & Co, solicitors, published an article on the outcome of a campaign to allow people to complete affidavits without having to take religious oaths or to have to state whether they held religious beliefs and what those beliefs (or lack of them) were for the purposes of completing essential legal documentation. It is said that this issue was rendered urgent by the Covid-19 crisis as affidavits sworn on oath cannot be completed remotely and this requires physical close meetings of multiple parties which involves unnecessary risk of infection in the context of a pandemic. The Civil Law and Criminal Law (Miscellaneous Provisions) Bill 2020 contains the necessary provisions.  The firm says that now that statements of truth are on the way, the challenge now is to make them available for use by everyone in all forms of legal proceedings and transactions.

https://www.oireachtas.ie/en/bills/bill/2020/18/

https://mccarthy.ie/blog/irish-legal-news/statements-of-truth-in-personal-injury-and-medical-negligence-claims/

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WIRECARD PROCESSED PAYMENTS FOR MALTESE CASINO LINKED TO ’NDRANGHETA

On 3 August, KYC 360 reported an Financial Times article claiming that Wirecard processed transactions for a Malta-based online casino that was later found to have laundered funds for the ’Ndrangheta mafia organisation.  Italian courts determined that the gaming company, Malta-based CenturionBet, was used by an arm of the ’Ndrangheta to launder millions of euros in criminal profits outside of Italy.  According to the newspaper, Wirecard separately processed payments for another large gambling company in Malta that was later accused by Italian authorities of laundering funds for organised crime groups.

https://www.riskscreen.com/kyc360/news/wirecard-processed-payments-for-maltese-casino-linked-to-ndrangheta-mafia-ft

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OTHER THINGS YOU MAY HAVE MISSED – AUGUST 2

Panama Covid-19 update  – 2 interesting items in the press here: the health ministry calling for extra ICU staff, and a criminal compliant being filed against the city’s mayor for allegedly breaching the curfew and not wearing his face mask in public…

https://www.prensa.com/judiciales/denuncian-al-alcalde-jose-luis-fabrega-por-violar-la-cuarentena-total/

The statistics keep rolling on – 1,070 more infections recorded today (added to the 1,127 of yesterday), meaning we now have 24,944 active cases – of whom 164 are in the overburdened ICU and 1,300 in other wards. 50 additional fatalities (22 today) take the total to date to 1,471.

2 August 2020

SOUTH KOREA: COURT TO DECIDE IF ASSETS BELONGING TO NIPPON STEEL BE SOLD OFF TO HONOUR A SUPREME COURT JUDGMENT ON WARTIME LABOUR

On 2 August, the Japan Times reported that, in a decision that could worsen already tense relations between Seoul and Tokyo, a court is expected to decide on whether to order that assets belonging to Nippon Steel Corporation be sold off to honour a 2018 Supreme Court judgment on wartime labour that ordered the Japanese company to compensate 4 Koreans for what was said to have been forced labour performed during the war.

https://www.japantimes.co.jp/news/2020/08/02/national/south-korea-wartime-labor-ruling-japan/#.Xya9th-SmM8

NEW ROUND OF SANCTIONS ON IRANIAN ALUMINIUM

On 1 August, Aluminium Insider reported on recently-imposed measures announced by the US.  In an attempt at denying the specialised metals Iran’s nuclear ballistic missile and military programmes, the Trump Administration described almost 2 dozen materials used as materials in the Iranian military’s nuclear weapons and delivery systems. Many of the new measures cover items already under sanction, giving greater descriptions of certain products for those previously-sanctioned materials. Included in the latest round of sanctions were 8 aluminium alloys, aluminium powder with a purity higher than 98%, and alumina. The remainder consisted of various grades of steel and copper alloys.

https://aluminiuminsider.com/trump-administration-levies-new-round-of-sanctions-on-iranian-aluminium/

JAMAICA: CORRUPTION CHARGES LIKELY FOR 5 POLITICIANS

On 2 August, the Gleaner reported that criminal charges hang over the heads of 5 current and former lawmakers who have been accused of flouting Jamaica’s anti-corruption law. The Integrity Commission has revealed that 2 current and 3 former parliamentarians were referred to its prosecutorial arm in the last fiscal year. Their names have not been made public. 4 were reported for non-presentation of additional information required to complete the examination of their statutory declarations and 1 for non-presentation of a statutory declaration. It is said that, since 2010, at least 32 current and former parliamentarians accused of failing to file their declarations or provide supporting information have been referred for prosecution. Members of parliament and senators, like other public officers, are required, under the Integrity Commission Act, to submit annual declarations of their income, assets and liabilities.

http://jamaica-gleaner.com/article/lead-stories/20200802/corruption-charges-likely-five-politicians

TAIWAN’S SECRETARY-GENERAL TO PRESIDENT RESIGNS AMID BRIBERY LINKED TO FAMILY

On 2 August, Taiwan News reported that the Secretary-General to the President had tendered his resignation as his nephew, a Democratic Progressive Party (DPP) legislator, faces charges of corruption. The nephew and the 5 other politicians have been accused of taking bribes from Lee Heng-long, former chair of Pacific Distribution, which used to be the parent company of Pacific Sogo Department Store, and Lee’s ultimate goal is said to be a return to his ownership of the department store chain.

https://www.taiwannews.com.tw/en/news/3979052

US DoJ INDICTS 6 TEXAS-BASED OWNERS AND MARKETERS FOR A SCHEME TO DEFRAUD TRICARE AND DEPARTMENT OF LABOR – MORE THAN $14 MILLION IN ILLEGAL KICKBACKS AND BRIBES

An article from the Health Care Compliance Association on 2 August reported that the DoJ Criminal Fraud division had indicted the persons for a scheme resulting in more than $14 million in illegal kickbacks and bribes 2014-16. The conspirators engaged in a scheme to pay kickbacks and bribes for the referral of TRICARE and the Department of Labor beneficiaries to obtain expensive compound drugs.

https://www.jdsupra.com/legalnews/us-department-of-justice-charges-co-82463/

https://www.justice.gov/opa/pr/six-texas-pharmacy-owners-and-marketers-charged-14-million-kickback-scheme

THE TACTICS AND TARGETS OF US DOMESTIC TERRORISTS

A brief from the Center for Strategic and International Studies on 30 July examines trends in terrorist tactics and targets.  According to CSIS data, firearms were the most common weapon used in fatal attacks over the past 5 years by far-right, far-left, and Salafi-jihadist terrorists.  In addition, the most common targets were individuals based on their ethnicity, race, or religion (such as African Americans, Latinos, Jews, and Muslims) for right-wing extremists; and government, military, and police targets for left-wing extremists and Salafi-jihadists. In particular, of note is the statement that, over the past 5 years, most right-wing attacks targeted individuals — generally because of their ethnic, racial, or religious background — or religious institutions. In addition, firearms were the most frequent weapons in lethal attacks. Between 2014 and 2020 the most frequent types of right-wing targets over this span included: abortion-related targets, such as women’s health clinics and medical staff (27%); private individuals and property, primarily selected due to race, ethnicity, or religion (25%); religious institutions, particularly synagogues, mosques, and churches (21%); and government, military, and police facilities and personnel (13%). But, it says, the targets of right-wing terrorist attacks have shifted over time and a shift in targets may have been caused by an upsurge in white supremacist activity and a decline in anti-abortion extremism. For left-wing terrorists, these primarily targeted government, military, and police facilities or personnel, followed by businesses and infrastructure targets. As with right-wing extremists, firearms accounted for the majority of fatal left-wing attacks. Then for Salafi-jihadists, these primarily attacked government, military, and police targets, though some of the most lethal targets included nightclubs and public locations like pedestrian paths. Much like right-wing and left-wing terrorists, Salafi-jihadists used firearms in most fatal attacks.

https://www.csis.org/analysis/tactics-and-targets-domestic-terrorists

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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US: WHEN YOU NEED AN EXPORT LICENCE FOR PATENT INFORMATION

On 1 August, an article from Sterne Kessler Goldstein & Fox LLP is concerned with 2 important, but sometimes overlooked issues in patent prosecution, particularly for companies with worldwide patent portfolios.  One of these is how to determine when an export licence may be necessary. It explains that foreign filing licences allow for the disclosure of technology to foreign jurisdictions for the limited purpose of filing patent applications abroad. It says that it may also be necessary to obtain an export licence prior to disclosing certain information to persons in foreign countries or to foreign nationals within the US – for items subject to control under the International Traffic in Arms Regulations (ITAR) or the Export Administration Regulations (EAR). Information regarding certain technologies (typically those which can have military applications) may not be communicated to persons in foreign countries, or to foreign nationals living in the US, without first obtaining an export licence.

https://www.jdsupra.com/legalnews/patent-prosecution-tool-kit-when-to-43210/

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US SANCTIONS IN RESPECT OF NORD STREAM 2/TURK STREAM GAS PROJECTS

On 1 August, Hellenic Shipping News carried an article about US sanctions targeting at limiting Russia’s influence over Europe’s energy requirements, in particular the development of the Nord Stream 2 pipeline between Russia and Germany via the Baltic Sea, and the Turk Stream pipeline connecting Russia with Turkey via the Black Sea. Sanctions include those which target the provision of cable-laying and other ships used in such projects, and a number of related services which could include the provision of P+I insurance. In recent weeks, it is said, the scope of those sanctions has been widened, and the article reviews these developments. The P+I Club involved says that its members should carefully consider whether any of their vessels entered in the Club are or may be involved in activities which are or could be subject to these US sanctions, and if so, to consult their usual Club/Underwriting contacts as soon as possible.

https://www.hellenicshippingnews.com/us-sanctions-in-respect-of-nord-stream-2-turk-stream-gas-projects/

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OTHER THINGS YOU MAY HAVE MISSED – AUGUST 1

Panama Covid-19 update – too early for the daily news conference, so at least no depressing listing of the latest infections and fatalities.  Meanwhile, the press reports that more than 1.5 million Panamanians (out of a population of around 4.3 million) have received a “solidarity bag” or bags containing food and basic necessities, cleaning and sanitiser materials, a digital and physical voucher.  There have been protests about slow deliveries of the food and necessities, which have cost the government some $60 million.

1 August 2020

ZIMBABWE: TRUCK DRIVER ARRESTED FOR SMUGGLING 12,500 BOTTLES OF BRONCO COUGH SYRUP

On 1 August, Pindula News in Zimbabwe reported that a truck driver has been arrested on charges of smuggling 12,500 100 ml bottles of cough syrup Broncleer (bronco) which has a street value of $2.5 Million from South Africa. Bronco is used as a recreational drug by some people in Zimbabwe.

https://news.pindula.co.zw/2020/08/01/truck-driver-arrested-for-smuggling-12-500-bottles-of-bronco/

INTERNATIONAL DATA TRANSFERS FROM THE EEA AND UK: TAKE CARE

On 31 July, HFW published a briefing saying that the Schrems II judgment, handed down by the Court of Justice of the European Union (CJEU) on 16 July, is significant for any organisation which currently transfers personal data outside of the EEA or the UK. It is especially significant for organisations which currently transfer personal data from the EEA or the UK to the US.

https://www.hfw.com/International-data-transfers-from-the-EEA-and-UK-Take-care-July-2020

BREXIT: NORTHERN IRELAND EU VAT IDENTIFICATION NUMBER

On 1 August, VAT Live reported that the EU will grant Northern Ireland businesses an EU VAT identification number to enable them to report goods transactions after 31 December 2020, the end of the Brexit transition period, when Northern Ireland adopts a dual participation role in the UK VAT and customs system, and the EU VAT, customs and Single Market – for goods only.  For services, it will be treated as remaining solely within the UK VAT regime. Northern Ireland remaining inside the EU systems (for goods only) prevents the need for physical border checks at the Irish border. Movements of goods between Northern Ireland and Ireland will remain as before Brexit.

https://www.avalara.com/vatlive/en/vat-news/uk-brexit-northern-ireland-eu-vat-identification-number.html

see also the following on the post-Brexit Northern Ireland VAT position –

https://www.avalara.com/vatlive/en/vat-news/uk-northern-ireland-vat-post-brexit.html

SERBIAN DRUG LORD GETS 9 YEARS JAIL FOR MONEY LAUNDERING

On 31 July, OCCRP reported that Belgrade High Court has sentenced 13 Serbian members of a criminal group led by drug lord Darko Šarić, with Šarić receiving a 9-year sentence for laundering millions of dirty drug money.  The group was involved in the production and trade of drugs and invested the proceeds into “legal money streams to hide its illegal origin”.

https://www.occrp.org/en/daily/12894-serbian-drug-lord-gets-nine-years-jail-for-money-laundering

TURKEY SUSPENDS SEA SURVEY OFF CYPRUS AFTER EU SANCTIONS THREAT

On 31 July, World ECR reported that Turkey had announced that it was planning to carry out a seismic survey south of 3 Greek islands, which would last until 2 August. Turkish media reported that President Recep Tayyip Erdogan had instructed his aides to ‘be constructive and put this on hold for some time,’ due to increased tensions with neighbouring Greece and prompted criticism by the US, Germany and other European countries.  Turkey has insisted that its drilling activity is part of an agreement with the Turkish Cypriot government in Northern Cyprus.

https://www.worldecr.com/news/turkey-suspends-sea-survey-after-eu-sanctions-threat/

SWISS SAY HUMANITARIAN TRADE CHANNEL TO IRAN IS UP AND RUNNING

On 31 July, World ECR has reported that Switzerland has announced that a humanitarian aid channel (the Swiss Humanitarian Trade Arrangement or SHTA), set up with US approval to allow Swiss-based companies to send medicines and other vital goods to Iran, has become operational, after a delay of several months following a pilot deal in January.

https://www.worldecr.com/news/swiss-say-humanitarian-trade-channel-to-iran-is-up-and-running/

IRELAND: PREPAREDNESS FOR DAC 6 MANDATORY TAX CROSS-BORDER DISCLOSURE REGIME

Irish law firm Matheson has published the results of a poll it undertook during a webinar involving Irish businesses. The firm asked its audience, made up of a mix of intermediaries and taxpayers what their state of readiness was on 8 July. The results, it says, were somewhat surprising.  It says that the most surprising results were that 16% of all respondents felt that their organisation was unprepared for DAC6 and only 3% of organisations polled felt that they were ready to file reports.

https://www.matheson.com/images/uploads/brexit/business/DAC6_Webinar_Attendees_Poll_2020.pdf

CRYPTOCURRENCY AND ICO IN THE BVI

On 30 July, Ogier published a briefing arguing that a BVI company offers a number of advantages which have made the BVI an attractive Initial Coin Offer (ICO) base. As a result, it says, the jurisdiction has seen a number of highly successful launches during the last 12 months.

https://www.ogier.com/publications/crypto-currency-and-icos-in-the-british-virgin-islands

THE RISE OF RANSOMWARE AND LEGAL COUNTERMEASURES

On 24 July, Field Fisher published an article which starts by saying that ransomware attacks, vicious malware that locks users out of their devices or blocks access to files until a sum or money is paid, are becoming increasingly prevalent across the globe.  For example, smartwatch company Garmin was forced to shut down its call centres, website and other online services after a ransomware attack encrypted its internal network and production systems.  Both the number of ransomware attacks and the percentage of attacks that result in payment have increased every year since 2017.  The article sets out to answer the question: when a company has no choice but to pay a ransom to get their business back online, does it have any means of subsequently recovering that money and tracing the perpetrators?

https://www.fieldfisher.com/en/services/fraud-financial-crime-and-investigations/fraud-corporate-crime-blog/the-rise-of-ransomware-and-legal-countermeasures

NEW EU REPORT SUGGESTS CONSUMER PROTECTION APPROACH TO TACKLE LOOT BOXES

On 27 July, an article from Field Fisher reported that a new report commissioned by the European Parliament’s Committee on Internal Market and Consumer Protection (IMCO) recommends tackling the topic of loot boxes by looking beyond gambling aspects and approaching the issue from a wider consumer protection angle.

https://www.fieldfisher.com/en/services/technology-outsourcing-and-privacy/technology-and-outsourcing-blog/consumer-protection-approach-to-tackle-loot-boxes

The report is at –

https://www.europarl.europa.eu/RegData/etudes/STUD/2020/652727/IPOL_STU(2020)652727_EN.pdf

NETHERLANDS: ULTIMATE BENEFICIAL OWNERS REGISTER UPDATE

On 24 July, an article from Field Fisher says that on 7 July, the Dutch government announced that the long awaited UBO register, of which the implementation is mandatory by EU law, will be implemented as per 27 September. The article explains what an UBO is in Dutch law and about the register and privacy matters.

https://www.fieldfisher.com/en/insights/ultimate-beneficial-owners-register-update

A GUIDE TO OPEN SOURCE NUCLEAR DETECTIVE WORK

On 28 July, the Nuclear Threat Initiative published this interesting article saying that images and videos contain an incredible amount of information that can be used to better understand military capabilities around the world – including nuclear weapons and long-range missiles. As an illustration of what can be done, the article provides an interactive detailing our analysis of a military exercise conducted by the US and UAE outside Dubai in 2018.

https://www.nti.org/analysis/articles/build-your-own-new-tools-toolbox-a-guide-to-open-source-nuclear-detective-work/

CENTRAL AFRICAN REPUBLIC: US ARMS EMBARGO

On 21 July, KPMG reported on a final rule amending the International Traffic in Arms Regulations (ITAR) to reflect an arms embargo concerning the Central African Republic.  No broker may engage in or make a proposal to engage in brokering activities subject to the ITAR involving the Central African Republic without first obtaining the approval of the Directorate of Defense Trade Controls (DDTC).

https://home.kpmg/us/en/home/insights/2020/07/tnf-us-arms-embargo-concerning-central-african-republic.html

https://s3.amazonaws.com/public-inspection.federalregister.gov/2020-13511.pdf

INDIA’S BAN ON CHINESE APPS

On 1 August, an article in Eurasia Review says that India recently banned 59 mobile applications of Chinese origin, including Tik Tok and WeChat.  It says that some analysts have speculated that the ban was driven by recent hostilities across the border but there is more to the move than meets the eye. Recent Sino-Indian skirmishes could have triggered the ban but other reasons exist, including supporting domestic technology firms and aligning with partners like the US on digital issues. However, the rationale for banning these Chinese apps rests on “national security concerns”.

https://www.eurasiareview.com/01082020-tik-toked-indias-ban-on-chinese-apps-analysis/

HOW DID TURKEY GAIN CONTROL OF LIBYA?

An Op-ed in Eurasia Review on 1 August asked this question, saying that Turkey is backed by Qatar and wants to control the Muslim Brotherhood in the region and to place the region under Turkey and Qatar.

https://www.eurasiareview.com/01082020-how-did-turkey-gain-control-of-libya-oped/

UK: EXPLAINING PERSONAL INSOLVENCY AND THE LAW

On 29 July, The Faculty of Law at the University of Oxford published a post which outlines the central features of the current personal insolvency system in England and Wales, and highlights key elements of this calculation in the context of the financial difficulties currently facing leaseholders.

https://www.law.ox.ac.uk/housing-after-grenfell/blog/2020/07/explaining-personal-insolvency-and-law

TREATY BANNING CLUSTER MUNITIONS TURNS 10 YEARS OLD – BUT WITHOUT THE US

An article in Just Security on 31 July reminded one that the Convention on Cluster Munitions entered into force 10 years ago, on 1 August 2010.  It was seen as a major advance for protecting civilians both during and after armed conflict.  The international treaty comprehensively banned cluster munitions and requires member countries to clear areas contaminated by cluster munition remnants within 10 years, destroy their cluster munition stocks within 8 years, and provide assistance for victims. The article asks, 10 years later, how is the Convention doing?  What challenges has it faced?

https://www.justsecurity.org/71756/treaty-banning-cluster-munitions-turns-10-but-without-the-us/

https://humanitariandisarmament.org/2020/07/31/convention-on-cluster-munitions-celebrates-10th-anniversary-a-living-legacy/

COOPERATION ON MILITARY TECHNOLOGY FOR THE DEVELOPMENT OF UAV AND CRUISE MISSILES IN THE ASIA-PACIFIC

On 28 July, a research paper from the International Institute for Strategic Studies examines the increased likelihood that UAV and cruise-missile technologies will proliferate throughout the Asia-Pacific. It argues that a technological  revolution is providing state and non-state actors with capabilities that previously belonged only to great powers. Advances in specific technologies and manufacturing are broadening access to long-range precision-strike capabilities, and an increasing number of states have an incentive to take advantage of this – particularly those that share a border with China.  It says that UAV and cruise-missile proliferation is seeing the same pattern of cooperative, facilitated proliferation of ballistic missiles (e.g. North Korea-Pakistan, Ukraine-China, Iran-North Korea).  Moreover, it argues, while developing nations have historically piggybacked on stronger states through technology sharing, today they are assisted through a number of sharing modalities and mechanisms, including technology adoption, overt cooperation (either co-production or co-development) and sales. To complicate matters further, these mechanisms may also be executed by non-state actors (from violent extremist organisations to defence contractors).

https://www.iiss.org/-/media/files/research-papers/cooperation-on-military-technology-for-the-development-of-uavs-and-cruise-missiles-in-the-asiapacifi.pdf

THE ILLICIT TRADE IN SMALL ARMS AND AMMUNITION IN VENEZUELA

On 27 July, Armament Research Services (ARES) announced the release of Research Report No. 10 which examines a new and thriving segment within Venezuela’s black-market arms trade, which has proliferated primarily through social media and secure messaging platforms – and focusing on those trades made via online platforms. Findings include diversion of arms from Venezuelan security forces; and strong connections to the US domestic firearms market.

http://armamentresearch.com/wp-content/uploads/2020/07/ARES-Research-Report-10-Black-Grey.pdf

SINGAPORE: HIGH COURT SETS OUT NEW SENTENCING FRAMEWORK FOR PUBLIC SECTOR CORRUPTION INVOLVING AGENTS

On 31 July, an article from Baker McKenzie reported that the new sentencing framework aims to provide the Singapore courts with a consistent and coherent methodology when dealing with such offences going forward.

https://globalcompliancenews.com/singapore-high-court-sets-out-new-sentencing-framework-for-public-sector-corruption-involving-agents-27072020/

THE TACTICS AND TARGETS OF DOMESTIC TERRORISTS IN THE US

On 30 July, a briefing from the Center for Strategic and International Studies says that, with a rise in domestic terrorism, it is increasingly important to analyse trends in terrorist tactics and targets.  According to CSIS data, firearms were the most common weapon used in fatal attacks over the past 5 years by far-right, far-left, and Salafi-jihadist terrorists. In addition, the most common targets were individuals based on their ethnicity, race, or religion (such as African Americans, Latinos, Jews, and Muslims) for right-wing extremists; and government, military, and police targets for left-wing extremists and Salafi-jihadists.

https://www.csis.org/analysis/tactics-and-targets-domestic-terrorists

IMPACT OF PENTAGON WEAPONS SPENDING ON JOBS (AND VOTES) IN 4 BATTLEGROUND STATES FOR THE 2020 US ELECTION

On 30 July, Forbes Magazine published an article saying that Pentagon weapons spending can potentially play a role in the election. Major programme awards can be worth billions of dollars and generate thousands of jobs within a state. For instance, the Navy recently selected a struggling Wisconsin shipyard to build a future class of frigates, potentially transforming that yard into a reliable source of jobs for decades to come. The Trump White House lost little time in taking credit.

https://www.forbes.com/sites/lorenthompson/2020/07/30/impact-of-pentagon-weapons-spending-on-jobs-and-votes-in-four-battleground-states/#3b148c4742e4

CORRUPTION IN CORONAVIRUS-RELATED PUBLIC TENDERS IN GEORGIA

An article from Bellingcat on 31 July says that, with the coronavirus pandemic and the sudden need for new government services, instead of utilising electronic tenders, so-called simplified state procurements take place in Georgia. This practice implies awarding non-competitive government contracts to companies, which may result in graft and breaches that include bribery, favouritism, influence peddling and self-serving purposes of the ruling party.

https://www.bellingcat.com/news/rest-of-world/2020/07/31/corruption-in-coronavirus-related-public-tenders-in-georgia/

WHEN GODFATHERS BECOME ENTREPRENEURS: ORGANISED CRIME’S INFILTRATION IN LEGAL ECONOMY – ITALY AND POTENTIAL EFFECT OF COVID-19

On 1 August, a post from VOX, the Centre for Economic Policy Research in Europe, says that criminal organisations invest vast sums of money within the legal economies of many countries worldwide. These investments provide criminal organisations with a powerful tool to raise forms of social consensus in some portions of the population. The article provides a characterisation of organised crime’s investment in Italy’s legal economy, a country historically plagued by the presence of criminal groups. The results indicate that during periods of economic and social downturn, organised crime may capitalise on the weaknesses of the institutional response to the crisis, consolidating and possibly expanding, its role as an investor in the legal economy.

https://voxeu.org/article/organized-crime-s-infiltration-legal-economy

THE EFFECTS OF THE DIFFUSION OF DUAL-USE ENABLING TECHNOLOGIES ON STRATEGIC STABILITY

On 27 July, an article from the Center for International and Security Studies at the University of Maryland argues that, left unchecked, the diffusion of dual-use enabling technologies — such as additive manufacturing, AI, and advanced communication technologies — may pose threats to strategic stability. The rapid development of these technologies by the US and its allies and partners has taken place primarily in the private sector, and is largely stored and transported in easily-diffused digital formats.  It could lead, the article says, to significant innovation in, or even transformation of, competitors’ military forces.  To counter these threats, the US and its allies and partners need a common awareness of the factors that enable and constrain technological diffusion, adoption, and transformation.  This paper develops a model of the pathways through which enabling technologies could affect strategic stability, drawing on the literatures on technological invention, innovation, and evolution; nuclear proliferation; and conventional arms flows. It identifies 4 pathways – buy, beg, steal or copy; but it says that none of these pathways guarantee successful diffusion of technological inventions, and are subject to a variety of countermeasures.

https://cissm.umd.edu/sites/default/files/2020-07/Dual_use_tech_Strategic_stability_072720.pdf

EU STUDY ON DIRECTORS’ DUTIES AND SUSTAINABLE CORPORATE GOVERNANCE

On 29 July, the EU published this report which sets out to assess the root causes of “short-termism” in corporate governance, discussing their relationship with current market practices and/or regulatory frameworks, and to identify possible EU-level solutions  It also takes into account contributing to the attainment of the UN Sustainable Development Goals and the goals of the Paris Agreement on climate change.  It suggests that a possible future EU action in the area of company law and corporate governance should pursue the general objective of fostering more sustainable corporate governance and contributing to more accountability for companies’ sustainable value creation.  For this reason, for each driver, alternative options characterised by an increasing level of regulatory intervention have been assessed against the baseline scenario (no policy change).

https://op.europa.eu/en/publication-detail/-/publication/e47928a2-d20b-11ea-adf7-01aa75ed71a1/language-en

IMF COVID-19 ANTI-CORRUPTION TRACKER

Transparency International has looked at all countries currently receiving COVID-19 financial assistance and debt relief from the IMF to see which funds include specific anti-corruption measures and which do not. At present, of 81 countries receiving such aid, 57 have some anti-corruption measures, 21 do not, and 3 are where a review is still pending.

https://www.transparency.org/en/imf-tracker

https://www.transparency.org/en/blog/the-imf-covid-19-and-anti-corruption-the-story-so-far

FALLING FOUL OF AML LAWS RESULTS IN MULTI-MILLION DOLLAR FINES FOR KIWI COMPANIES

In its 2 August edition, Stuff in New Zealand reported that 2 linked operations processed well over $400 million of transactions between 2015 and 2019 in breach of laws designed to deter money laundering.MSI Group, was currency changing and the remittance of money, mainly from New Zealand to China, and OTT Trading, was doing the same thing in Auckland, running up $196 million of transactions in the same period 2015-19. They have been fined a total of over $7.5 million.

https://www.stuff.co.nz/business/money/122281820/falling-foul-of-antimoney-laundering-laws-results-in-multimillion-dollar-fines-for-kiwi-companies

ENCRYPT

 

 

 

 

 

 

 

 

 

 

 

 

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WCO ISSUES ITS 2019 ILLICIT TRADE REPORT

On 30 July, the World Customs Organisation published its Illicit Trade Report for 2019 which offers a comprehensive study of illicit trade flows through an in-depth analysis of seizure data and case studies voluntarily submitted by 137 customs administrations worldwide. The report consists of 6 sections: cultural heritage; drugs; environment; IP rights, health and safety; revenue and security.

http://www.wcoomd.org/-/media/wco/public/global/pdf/topics/enforcement-and-compliance/activities-and-programmes/illicit-trade-report/itr_2019_en.pdf?db=web

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HONG KONG: AML/CFT MEASURES IN THE PERIOD OF COVID-19

On 30 July, the Hong Kong Monetary Authority issued a Circular to share observations and industry practices to assist Authorized Institutions in developing sustained efforts to cope with the evolving COVID-19 situation and support operational responses which are consistent with the risk-based approach.  Key observations and practices are highlighted in the Circular and further details are summarised in an Annex. It covers CDD under social distancing and travel restrictions, pressure on AML/CFT resources, and emerging threats and changes in customers’ behaviour.

https://www.hkma.gov.hk/media/eng/doc/key-information/guidelines-and-circular/2020/20200730e1.pdf

https://www.hkma.gov.hk/media/eng/doc/key-information/guidelines-and-circular/2020/20200730e1a1.pdf

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CHINESE FISHING NEAR NORTH KOREA IS A SYMPTOM OF A BIGGER IUU FISHING PROBLEM

An article in The Diplomat on 31 July says that the Chinese government has been both lenient on North Korea sanctions and reluctant to tackle illegal fishing by its distant water fleet. It says that a study found more than 900 Chinese vessels fishing in these waters in 2017, and 700 in 2018, said to be roughly one-third of China’s entire distant-water fishing fleet, and that further research has shown similar levels of Chinese fleet activity in 2019. The article says that the evidence is indicative of a larger problem of illegal, unreported, and unregulated (IUU) fishing and other illicit activities, especially by distant water fishing (DWF) fleets, which threaten the long-term sustainability of fisheries resources and the economic, food, and environmental security of coastal countries, and not just North Korea. It says that China is currently the top DWF nation, comprising about 40% of global DWF operations. China continues expanding its DWF fleets across West Africa, South America, and the South China Sea and, while not all of China’s DWF operations are engaged in IUU, these fleets have often been seen fishing illegally in another countries’ EEZ or right up to the line, and have been caught exceeding fish catch quotas.

https://thediplomat.com/2020/07/chinese-fishing-near-north-korea-is-a-symptom-of-a-bigger-problem/

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US SUPREME COURT SET TO REVISIT DECADES-OLD QUESTION: CAN COMPANIES BE HELD LIABLE FOR HUMAN RIGHTS ABUSES COMMITTED OVERSEAS?

On 1 August, an article from Baker McKenzie says that the Alien Tort Statute has been the subject of several US Supreme Court decisions over the past decade. The ATS is a statute that gives US federal courts jurisdiction to hear lawsuits filed by non-US citizens for torts committed in violation of international law. In recent years, plaintiffs have tried to use the ATS as a vehicle to hold multinational corporations liable for human rights violations and labour abuses committed abroad by their subsidiaries, suppliers, and other third-party business partners.  However, cases have established a presumption that the ATS does not apply extraterritorially. But in 2019 a new case challenged precedent by seemingly widening the scope of potential ATS liability, and this case is poised to reach the Supreme Court. The case in question is centred on financial support provided by the defendants to the cocoa farms in Ivory Coast where child labour is said to be used.

https://globalcompliancenews.com/united-states-supreme-court-set-to-revisit-decades-old-question-can-companies-be-held-liable-under-the-ats-for-human-rights-abuses-committed-overseas-27072020/

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FACTSHEET: US POLICY ON THE EXPORT OF UNMANNED AERIAL SYSTEMS

On 27 July, this Factsheet was issued by the US State Department. It says that, despite the policy change announced by the Trump Administration on 24 July, 5 primary objectives with respect to UAS transfers remain unaltered –

  • To increases trade opportunities for U.S. companies;
  • To bolster partner security and counterterrorism capabilities;
  • To strengthen bilateral relationships;
  • To preserve U.S. military advantage; and
  • To prevent the proliferation of WMD delivery systems.

All potential military UAS transfers will continue to be subject to Department of State-led assessment and Department of Defense (DoD)-led assessment regarding technology security, as applicable.  All UAS transfers, including military UAS transfers, will be reviewed consistent with US international non-proliferation commitments, including under the Missile Technology Control Regime (MTCR).

https://www.state.gov/u-s-policy-on-the-export-of-unmanned-aerial-systems-2/

The statement on the change in US UAS export policy is at –

https://www.state.gov/trump-administration-approves-updated-unmanned-aerial-system-uas-export-policy/

Affected are UAS with a maximum airspeed less than 800 kmh and discretion over the strong presumption of denial for transfers involving such types.

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US COURT OF APPEAL AFFIRMS BANK FRAUD CONVICTIONS IN SANCTIONS EVASION CASE

On 31 July, an article from Clifford Chance reported on what it says is the first appellate court decision to affirm a bank fraud conviction in the context of a scheme to evade US sanctions – involving Halkbank, a Turkish state-owned bank.   In the case, Mehmet Hakan Atilla and his co-conspirators helped to steer billions of US dollars to Iran by disguising Iranian oil proceeds as permissible payments and humanitarian assistance. The article points out that, since bank fraud charges carry a longer statute of limitations and do not require the same proof of willfulness as other potential offences, the practice of charging bank fraud heralds a significant expansion of potential criminal liability

https://www.cliffordchance.com/content/dam/cliffordchance/briefings/2020/07/Second-Circuit-Affirms-Bank-Fraud-Convictions-in-Sanctions-Evasion-Case.pdf

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OFAC’S LATEST SETTLEMENT PROVIDES AN IMPORTANT REMINDER ON STRENGTHENING COMPLIANCE PROGRAMMES

On 30 July, an article from Clifford Chance said that OFAC announced a settlement with Whitford Worldwide Company LLC, a cookware coating manufacturer based in the US, relating to sales by its non-US subsidiaries to Iran that occurred between 2012 and 2015, and allegedly caused by the company’s failure to identify and adequately manage its OFAC risk.  The article says that, while the conduct is more than 5 years old, the settlement provides important reminders for those focused on OFAC compliance and managing related compliance risks.

https://www.cliffordchance.com/content/dam/cliffordchance/briefings/2020/07/Everything-But-the-Kitchen-Sink-OFACs-Latest-Settlement.pdf

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OTHER THINGS YOU MAY HAVE MISSED – JULY 31

Panama Covid-19 update – no sign of slow up in new cases…another 1,065 today – taking the total to 65,256, of which 24,669 are active.  There have been 24 more fatalities, taking the total to date to 1,421.

31 July 2020

SFO CHARGES AIRBUS SUBSIDIARY WITH FRAUD RELATING TO UK CONTRACT WITH SAUDI NATIONAL GUARD

On 30 July, the Financial Times and others reported that the SFO has charged an Airbus subsidiary, GPT, which ceased operations in April, over a contract with the Saudi National Guard. GPT former MD Jeffrey Cook and John Mason, a finance officer at 2 of the company’s subcontractors were charged. A third individual, former Ministry of Defense official Terence Dorothy, was charged with aiding and abetting Cook. Part of the probe investigated allegations that GPT executives had bribed Saudi military officials with unexplained payments to Cayman Island bank accounts and luxury items. Airbus acquired GPT from Ericsson of Sweden in 2007 on the recommendation of the UK MoD and the Saudi contract was struct as the result of a government to government deal. The MoD was GPT’s sole customer.

https://www.wsj.com/articles/u-k-charges-airbus-subsidiary-over-saudi-deal-11596139415

THE COMMITTEE ON FOREIGN INVESTMENT IN THE US (CFIUS) ANNUAL REPORT

On 30 July, the Wall Street Journal reported on the CFIUS annual report, which reveals that it has reviewed 325 business transactions that involved foreign money, topping the number of deals the panel has reviewed each year since 2010. By comparison, in 2018 it reviewed 249 transactions.  The national-security review panel has taken a higher profile in recent years on heightened concerns that China has been trying to acquire US technology.

https://www.wsj.com/articles/u-s-panel-expands-review-of-business-deals-with-foreign-money-11596146350

UK COMPANIES HOUSE REGISTRAR RULES

On 31 July, Companies House published updated rules outlining the form, manner of delivery and method of authentication for documents delivered in electronic or paper format. The Registrar of Companies is given authority to make rules governing certain areas in relation to the filing of documents at Companies House. They came into force on 1 October 2009 and have been amended several times since this date.

https://www.gov.uk/guidance/registrars-rules

GERMAN FAR-RIGHT BUYS LAND FOR MILITARY TRAINING, MONEY LAUNDERING AND MONEY-MAKING

On 31 July, KYC 360 reported that right-wing extremists are moving into property to set up bases for their activities and anchor themselves in local communities, German intelligence services have warned.  Neo-Nazis are seeking land and buildings in rural parts of eastern states, officials said. Funding was generated by a “far-right economy” based on publishing, merchandise and hosting rock concerts.

https://www.riskscreen.com/kyc360/news/german-far-right-buys-land-for-military-training-money-laundering-and-money-making

AUSTRALIA: CROWN RESORTS DUE DILIGENCE OF JUNKET PARTNERS CARRIED OUT WITHIN THE MARKETING TEAM TASKED WITH LURING WEALTHY HIGH-ROLLERS – A CONFLICT OF INTEREST?

On 31 July, KYC 360 relayed an article from The Age saying that Crown Resorts conducts its due diligence of junket partners to check for potential criminal links from within the marketing team tasked with luring wealthy high-rollers to its casinos, creating what the group’s legal chief concedes could be a conflict of interest. This emerged during testimony before the New South Wales Independent Liquor and Gaming Authority inquiry into Crown how the group decides whether to do business with junket operators, which bring wealthy Chinese gamblers to its casinos.  The Inquiry is concerned with the group’s licence and concerns that some of Crown’s junket partners had links to organised crime and money launderers. Separately, it was also claimed that Crown Resorts opened accounts with the Commonwealth Bank using “misleading” names that masked their use for gambling and accepted high-risk cash deposits, despite ANZ shutting down similar accounts over money laundering concerns.

https://www.theage.com.au/business/companies/crown-s-junket-criminal-checks-start-with-marketing-team-inquiry-told-20200730-p55gxo.html

https://www.smh.com.au/business/companies/crown-moved-to-cba-when-anz-shut-money-laundering-accounts-inquiry-hears-20200731-p55ha7.html

OVERVIEW OF JERSEY COMPANY LAW

On 27 July, Ogier published a brief guide produced to provide an at-a-glance summary of company law in Jersey and to provide a broad overview of the laws applicable in the jurisdiction.

https://www.careyolsen.com/briefings/overview-jersey-company-law

NEW ZEALAND: RESERVE BANK FINALISING ENFORCEMENT ACTION AGAINST TSB OVER ALLEGED NON-COMPLIANCE WITH AML/CFT ACT

On 31 July, Interest in New Zealand reported that the bank says it’s “actively remediating” problems with its programme to comply with the AML/CFT Act that were identified by the Reserve Bank. TSB says civil legal proceedings could stem from discussions with its regulator, and it has made a provision to cover a potential liability.

https://www.interest.co.nz/banking/106297/tsb-aml-woes

MARYLAND MAN WAS SENTENCED FOR HIS USE OF AT LEAST 2 FALSE PASSPORTS TO OPEN “DROP ACCOUNTS” FOR A MONEY LAUNDERING CONSPIRACY

On 31 July, WTOP News reported that a Maryland man, Arinze Michael Ozor, 37, a dual citizen of the US and Nigeria, has been sentenced to 18 months in federal prison for his use of at least 2 false passports to open 8 “drop accounts” for a money laundering conspiracy involving nearly $1 million.

https://wtop.com/crime/2020/07/md-man-gets-prison-time-for-fake-passports-in-money-laundering-case/

EU COMMISSION PUBLISHES STUDY ON DIRECTORS’ DUTIES AND SUSTAINABLE CORPORATE GOVERNANCE  

On 31 July, the EU reported that the Commission had published the findings of its study on directors’ duties and sustainable corporate governance. The study shows that listed companies within the EU still tend to focus on short-term benefits of shareholders rather than on the long-term interests of companies.

https://ec.europa.eu/commission/presscorner/detail/en/MEX_20_1436

THE UK DRUG SITUATION

On 31 July, the Home Office published updated information in the Focal Point containing the annual report and data tables from the UK Focal Point on Drugs on the national prevalence, impact, prevention and treatment of drug use. The report covers the prevalence of illegal drug use, national and regional policy and legal framework, prevention and treatment of drug use, the drug situation in prisons, drug-related deaths, disease and other harm and the illegal drug market.

https://www.gov.uk/government/publications/united-kingdom-drug-situation-focal-point-annual-report

TAIWAN PROSECUTORS RAID LEGISLATIVE OFFICES OVER BRIBERY ALLEGATIONS

On 31 July, Taiwan News reported that prosecutors have raided the offices of 4 legislators and 2 former lawmakers, reportedly in connection with bribery allegations related to a past struggle for control over the Sogo department stores. More than 65 homes and offices across the country were raided. Sogo became the focus of a power struggle when the original manager, the Pacific Group, encountered financial difficulties, with ownership changing hands in 2002 in a procedure which became the focus of litigation for years afterward.

https://www.taiwannews.com.tw/en/news/3977792

DATA PROTECTION IN ONLINE GAMBLING

On 31 July, Taylor Wessing published a briefing saying that operators based in the EU or offering services to individuals in the EU will be caught by the GDPR and, potentially, national data protection laws. Online gambling businesses also have to comply with laws in other areas, including in relation to AML and fraud prevention. This can lead to confusion about which requirements take precedence. It looks at the European Gaming and Betting Association (EGBA) code of conduct.

https://www.taylorwessing.com/en/insights-and-events/insights/2020/07/data-protection-in-online-gambling

UK: JUDGMENT IN CHINESE FRAUD AND TORTURE CASE DUE

On 31 July, Scottish Legal News reported that judgment in a case concerning alleged fraud and torture will be handed down in the next week by the UK Supreme Court via video link.  The appellant and respondent are both based in China.  In August 2008, a charterparty was concluded and the defendant provided a guarantee for payment obligations under the charterparty in 2008.  In December 2010, the appellant made a demand under the guarantee, after the shipping company defaulted. The defendant declined to pay and the charterparty was terminated. The defences claimed are fraudulent non-disclosure and illegality, with alleged bribery involved, and that confession evidence involved was obtained by torture and was therefore inadmissible.

https://www.scottishlegal.com/article/judgment-in-chinese-fraud-and-torture-case-to-be-handed-down-next-week

SFO CONFISCATES MILLIONS FROM EX-AFREN EXECUTIVES

Energy Voice on 31 July reported that the SFO has won court orders confiscating £5.45 million from former Afren executives following convictions for fraud and money laundering in October 2018 over a Nigerian oil deal.

https://www.energyvoice.com/oilandgas/africa/256325/afren-sfo-shahenshah-ullah/

EU TAX POLICY REPORT 2020: PART 1

On 29 July, CFE Tax Advisers Europe, a Brussels-based association of European tax advisers, has published this report which provides a detailed analysis of primary tax policy developments at EU level of interest to European tax advisers. It also includes an overview of relevant CJEU case-law European Commission decisions covering the first half of 2020 – noting the effects of covid-19.

https://taxadviserseurope.org/wp-content/uploads/2020/07/CFE-EU-Tax-Policy-Report-January-July-2020.pdf

SUMMARY LIST OF COUNTRIES INDICATING MEMBERSHIP TO ONE OR MORE OF THE INTERNATIONAL EXPORT CONTROL REGIMES

On 31 July, the UK Department for International Trade provided an updated listing of countries belonging to each of the following international export control regimes – Australia Group; Missile Technology Control Regime (MTCR); Nuclear Technology Group (NSG); and Wassenaar Arrangement.

https://www.gov.uk/government/publications/list-of-international-non-proliferation-regime-members/list-of-international-non-proliferation-regime-members

UK GOVERNMENT LAUNCHES INDEPENDENT PANEL TO LOOK AT JUDICIAL REVIEW

On 31 July, the MoJ announced that a panel of experts will examine if there is a need to reform the judicial review process after an independent review has been launched.

https://www.gov.uk/government/news/government-launches-independent-panel-to-look-at-judicial-review

EU REACTION TO THE FALL OF PRIVACY SHIELD: THE RISE OF STANDARD CONTRACTUAL CLAUSES?

On 31 July, an article from Sheppard Mullin says that companies which transfer data from the EU to the US are struggling to determine the appropriate basis under which they can make these transfers, following the European court decision rejecting use of the so-called Privacy Shield.  One of the alternate mechanisms for data transfers are Standard Contractual Clauses (SCC). While the court concluded that SCC remained valid, it outlined restrictions that have been giving companies pause.

https://www.jdsupra.com/legalnews/eu-reaction-to-the-fall-of-privacy-19067/

US REJECTS EU CLAIMS OF WTO CASE COMPLIANCE AS LAWMAKERS SEEK TARIFF CHANGES

On 31 July, Sandler Travis Rosenberg reported that additional tariffs on billions of dollars’ worth of imports from the EU appear set to remain in effect after the US rejected an EU claim that it is now in compliance with a WTO ruling against subsidies provided to aircraft manufacturer Airbus

https://www.strtrade.com/news-publications-EU-tariff-Airbus-WTO-subsidy-food-drink-073120.html

EX-COUTTS & CO BANKER LINKED TO $700 MILLION 1MDB TRANSFER FOUND GUILTY BY SWISS COURT

On 31 July, Malay Mail reported that a former banker from Coutts & Co was found guilty for his failure to flag money laundering activities of a $700 million transfer into an account controlled by fugitive financier Low Taek Jho. Only identified as A, he was fined CHF50,000 by the Swiss Federal Criminal Court.

https://www.malaymail.com/news/malaysia/2020/07/31/ex-coutts-co-banker-linked-to-us700m-1mdb-transfer-found-guilty-by-swiss-co/1890026

MALTESE BANKS TOLD TO KEEP EYES OPEN FOR SUSPICIOUS TERROR FUNDING PATTERNS

On 30 July, Malta Today reported that a report by the FIAU has revealed various cases in which Maltese credit institutions were used for the funding of terror organisations, as well as for illegal activities of human smuggling inside the African continent. According to a risk assessment from the National Co-ordinating Committee on Combating Money Laundering and Funding of Terrorism Malta is vulnerable at any stage of raising, movement or the use of terrorist funding. The article quotes examples, including a case where a total of 4,418 airline ticket purchases were identified, of which 600 were conducted by the same individual who was later arrested due to his links with a terrorist organisation recruiter and his involvement in a migrant trafficking ring.

https://www.maltatoday.com.mt/news/national/103835/banks_told_to_keep_eyes_open_for_suspicious_terror_funding_patterns#.XyRBaziSmM9

THE ROLE OF THE MONEY LAUNDERING REPORTING OFFICER (MLRO)

An article from DQ in the Isle of Man on 28 July says that, in 2019, the Jersey FSC undertook a themed examination of licence-holders focusing on the role of the MLRO which detailed the expectations of an MLRO and also highlighted areas where the expected standards or regulatory obligations were not being achieved. The article links to the report and says that MLRO should review the detail of the report for indicators as to how their own policies and procedures might be enhanced – and the article highlights some particularly relevant parts of the report.

https://dq.im/themed-examination-programme-the-role-of-the-money-laundering-reporting-officer/

PODCAST: HOW TO PREVENT IRAN FROM EVADING SANCTIONS AT SEA

On 30 July, the Iran Watch website published a podcast involving a discussion of deceptive shipping practices used by Iran to evade US sanctions, and US efforts to counter these practices, with 2 experts from the US State Department.

https://www.iranwatch.org/our-publications/interviews-podcasts/iran-watch-listen-how-prevent-iran-evading-sanctions-sea

US SANCTIONS: GLOBAL MAGNITSKY GENERAL LICENSE AND FAQ

On 31 July, OFAC announced the issue of General License 2 “Authorizing Certain Wind Down and Divestment Transactions and Activities Related to Blocked Subsidiaries of the Xinjiang Production and Construction Corps (XPCC)”, as well as a new FAQ 835 explaining the purpose and use of the General License.  The General License runs to 30 September and the FAQ warns that, after the expiration of the general authorisation it contains, US persons will be prohibited from engaging in or facilitating transactions with Blocked XPCC Subsidiaries unless exempt or authorised by OFAC.

https://www.treasury.gov/resource-center/faqs/Sanctions/Pages/faq_other.aspx#835

THE QAnon CONSPIRACY THEORY: A SECURITY THREAT IN THE MAKING?

An article in the latest edition of the CTC Sentinel for July 2020 is concerned with the QAnon conspiracy theory, which emerged in 2017, has quickly risen to prominence in the US.  It says that a survey of cases of individuals who have allegedly or apparently been radicalised to criminal acts with a nexus to violence by QAnon, including one case that saw a guilty plea on a terrorism charge, makes clear that QAnon represents a public security threat with the potential in the future to become a more impactful domestic terror threat. This, it says, is true especially given that conspiracy theories have a track record of propelling terrorist violence elsewhere in the West as well as QAnon’s more recent influence on mainstream political discourse. It says that, at first sight, QAnon, the bizarre assemblage of far-right conspiracy theories that holds that President Trump is waging a secret war against an international cabal of satanic paedophiles seems to present a far lesser threat to public security.  However, the authors argue that QAnon represents a novel challenge to public security.

https://ctc.usma.edu/the-qanon-conspiracy-theory-a-security-threat-in-the-making/

HOW IRAN’S OIL INDUSTRY GETS AMERICAN MACHINERY

An article from Iran Watch at the Wisconsin Project on 30 July considers the case of Ohio resident Behrooz Behroozian, sentenced to 20 months in prison in October 2019, and the export of industrial equipment illegally and for the benefit of Iran’s gas and petrochemical industries. Behroozian and his associates followed a well-known playbook used by Iranian smugglers: shipping US-made goods through intermediaries in third countries to obscure the final destination in Iran.

https://www.iranwatch.org/our-publications/international-enforcement-actions/how-irans-oil-industry-gets-american-machinery

ASSESSING RUSSIAN INFLUENCE IN GERMANY

On 31 July, the Center for Strategic and International Studies published the latest in a series of reports on Russian influence activities in the UK and Germany and Chinese influence activities in Australia and Japan.  It examines the nature and tactics of Russian influence operations in Germany, which characteristics have made Germany vulnerable and resistant to Russian influence, and what lessons the German experience offers for other democratic states in countering malign influence activities.

https://csis-website-prod.s3.amazonaws.com/s3fs-public/publication/200724_Mankoff_FullReport_v3.pdf

A podcast interview with the author is also available –

https://www.csis.org/podcasts/russian-roulette/russian-influence-germany-russian-roulette-episode-104

OECD RELEASES NEW ACTION 14 PEER REVIEW REPORTS

On 31 July, Tax News reported that the OECD has released peer review reports reviewing 9 territories’ progress towards implementing the BEPS Action 14 standard, on improving cross-border tax dispute resolution –  Andorra, Bahamas, Bermuda, BVI, Cayman Islands, Faroe Islands, Macau, Morocco, and Tunisia.

https://www.tax-news.com/news/OECD_Releases_New_Action_14_Peer_Review_Reports____97771.html

MALWARE AUTHOR PLEADS GUILTY FOR ROLE IN TRANSNATIONAL CYBERCRIME ORGANISATION RESPONSIBLE FOR MORE THAN $568 MILLION IN LOSSES

A news release from the US DoJ on 31 July advised that Valerian Chiochiu, aka “Onassis,” “Flagler,” “Socrate,” and “Eclessiastes”, 30, the author of malicious computer software and a member of the Infraud Organization has pleaded guilty today to RICO conspiracy. This was just over a month after the co-founder and administrator of Infraud, Sergey Medvedev of Russia, separately pleaded guilty.  Infraud was an Internet-based cybercriminal enterprise engaged in the large-scale acquisition, sale, and dissemination of stolen identities, compromised debit and credit cards, personally identifiable information, financial and banking information, computer malware, and other contraband.

https://www.justice.gov/opa/pr/malware-author-pleads-guilty-role-transnational-cybercrime-organization-responsible-more-568

CALIFORNIA POLICE OFFICER CHARGED WITH $18 MILLION MONEY LAUNDERING AND TAX EVASION SCHEME

The San Francisco Chronicle on 31 July reported claims that a San Jose police officer used a private security company to evade taxes, steal wages, commit insurance fraud and launder more than $18 million.

https://www.sfchronicle.com/crime/article/San-Jose-police-officer-charged-with-18-million-15450098.php

SEC HAS ANNOUNCED THAT BAUSCH HEALTH, FORMERLY CANADA-BASED VALEANT PHARMACEUTICALS, AND 3 EXECUTIVES HAVE AGREED TO PAY PENALTIES TO SETTLE CHARGES OF IMPROPER REVENUE RECOGNITION AND MISLEADING DISCLOSURES IN FILINGS AND EARNINGS PRESENTATIONS

A release on Mondon Visione on 31 July reported that Bausch Health, formerly Quebec, Canada-based Valeant Pharmaceuticals, had agreed to pay a $45 million penalty to settle charges of improper revenue recognition and misleading disclosures in SEC filings and earnings presentations. 3 former executives – the CEO, CFO, and controller – also agreed to pay penalties to settle charges against them.

https://mondovisione.com/media-and-resources/news/sec-pharmaceutical-company-and-former-executives-charged-with-misleading-financ/

US SANCTIONS IN RESPECT OF NORD STREAM 2 AND TURK STREAM GAS PROJECTS

On 31 July, Hellenic Shipping News carried an article saying that the US Government has for some time applied sanctions in respect of certain European energy programmes in which Russia plays a significant role. Those sanctions are targeted at limiting Russia’s influence over Europe’s energy requirements, in particular the development of the Nord Stream 2 pipeline between Russia and Germany via the Baltic Sea, and the Turk Stream pipeline connecting Russia with Turkey via the Black Sea. The article provides a brief summary of the sanctions, saying that they target the provision of cable-laying and other ships used in such projects, and a number of related services which could include the provision of P&I insurance. In recent weeks, it warns, the scope of those sanctions has been widened.

https://www.hellenicshippingnews.com/us-sanctions-in-respect-of-nord-stream-2-turk-stream-gas-projects/

 

 

 

 

 

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OFAC ADDS 2 INDIVIDUALS AND 1 ENTITY TO ITS GLOBAL MAGNITSKY SANCTIONS LISTS

On 31 July, OFAC advised that 2 Chinese individuals linked to the Xinjiang Production and Construction Corps, and that entity itself, had been added to the sanctions lists. This Chinese government entity and the 2 current or former government officials are listed in connection with alleged serious rights abuses against ethnic minorities in the Xinjiang Uyghur Autonomous Region (XUAR).

https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20200731.aspx

https://home.treasury.gov/news/press-releases/sm1073

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US SANCTIONS: GLOBAL MAGNITSKY GENERAL LICENSE AND FAQ

On 31 July, OFAC announced the issue of General License 2 “Authorizing Certain Wind Down and Divestment Transactions and Activities Related to Blocked Subsidiaries of the Xinjiang Production and Construction Corps (XPCC)”, as well as a new FAQ 835 explaining the purpose and use of the General License.  The General License runs to 30 September and the FAQ warns that, after the expiration of the general authorisation it contains, US persons will be prohibited from engaging in or facilitating transactions with Blocked XPCC Subsidiaries unless exempt or authorised by OFAC.

https://www.treasury.gov/resource-center/faqs/Sanctions/Pages/faq_other.aspx#835

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US SANCTIONS: MAJOR EXPANSION OF THE SCOPE OF STATE DEPARTMENT-ADMINISTERED IRAN METALS-RELATED SANCTIONS

On 30 July, a news release from the US State Department advised that it was designating 22 specific materials used in connection with Iran’s nuclear, military, or ballistic missile programmes. Those who knowingly transfer such materials to Iran are now liable to US sanctions measures. The 22 materials are –

  • ALUMINIUM 319
  • ALUMINIUM 1100
  • ALUMINIUM 225
  • ALUMINIUM 6061
  • ALUMINIUM 6063
  • ALUMINIUM 6082
  • ALUMINIUM 7075
  • ALUMINIUM BROZE ALLOY UNS C63600 (CDA alloy 636)
  • ALUMINIUM OXIDE (Al2O3)
  • STEEL 302
  • STEEL 4130
  • STAINLESS STEEL 321
  • STAINLESS STEEL 316
  • A877 STEEL
  • A228 STEEL
  • 100Cr6-52100 STEEL
  • 350 MARAGING STEEL (also known as MARAGING STEEL350)
  • 300 MARAGING STEEL (also known as MARAGING STEEL300)
  • UNS Cl7200-TDO1 [BERYLLIUM COPPER]
  • UNS C37000 – CuZn38Pb1
  • TUNGSTEN COPPER
  • ALUMINIUM POWDER with purity above 98%.

https://www.state.gov/expansion-of-the-scope-of-iran-metals-sanctions-targeting-irans-nuclear-military-and-ballistic-missile-programs-and-the-irgc/

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JERSEY FSC COMMITTED TO HELPING INDUSTRY WITH KYC UTILITY

A news release from the FSC on 30 July said that it had announced its commitment to support the financial services industry with the development of a shared ‘know your customer’ (KYC) utility to provide a shared tool for verifying customers’ identity. This could result in reduced costs when taking on new clients, whilst introducing an enhanced degree of assurance as to the quality of these client processes.

https://www.jerseyfsc.org/news-and-events/jfsc-committed-to-helping-industry-with-kyc-utility/

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EL MENCHO’S HOSPITAL BUILT BY MEXICO CARTEL

An article in Insight Crime on 31 July said that the Jalisco Cartel New Generation (CJNG) cartel had constructed a hospital, both for the head of the cartel and local residents, is an actual concrete example of Mexico’s criminal groups investing in real infrastructure to garner the support of local communities. The hospital was primarily constructed so that Oseguera Cervantes, who is believed to suffer from kidney disease, could receive treatment without putting himself at risk of capture by authorities.

https://www.insightcrime.org/news/analysis/el-mencho-hospital-mexico/

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FRENCH BANK ACCUSES INDONESIAN OIL TRADER WITH OPERATIONS IN SINGAPORE OF CONSPIRING WITH SCANDAL-HIT TRADING HOUSE HONTOP OVER FRAUDULENT CRUDE OIL TRANSACTIONS

On 31 July, Global Trade Review reported that the French bank Natixis has accused Sugih Energy, an Indonesian oil trader with operations in Singapore, of conspiring with scandal-hit trading house Hontop over fraudulent crude oil transactions. It has emerged that Hontop is accused of creating elaborate fake trades in order to obtain financing from Malaysian bank CIMB. Singapore’s oil trading sector has been hit by a wave of fraud allegations, following several high-profile collapses.

https://www.gtreview.com/news/asia/oil-trader-sugih-conspired-with-hontop-on-oil-trade-fraud-natixis-claims/

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EU ISSUES UPDATED LIST OF PERSONS AND ENTITIES ON TERRORISM SANCTIONS LIST

EU Regulation 2020/1128/EU has issued a new list of individuals and entities subject to sanctions under EU Regulation 2580/2001/EC.

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2020.247.01.0001.01.ENG&toc=OJ:L:2020:247:TOC

https://www.consilium.europa.eu/en/press/press-releases/2020/07/30/eu-fight-against-terrorism-terrorist-list-renewed-for-a-further-six-months-and-one-person-added-to-the-isil-da-esh-and-al-qaida-list/

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EU UPDATES A NUMBER OF NORTH KOREAN SANCTIONS ENTRIES

On 31 July, EU Regulation 2020/1129/EU, after a review of the DPRK sanctions lists, the statement of reasons for 19 persons and the identifying information of 5 persons and 2 entities should be updated and that the gender of all natural persons listed in Annex XV should be included in the identifying information.

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2020.247.01.0005.01.ENG&toc=OJ:L:2020:247:TOC

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OTHER THINGS YOU MAY HAVE MISSED – JULY 30

Panama Covid-19 update – the national airline, COPA, has said that it has revised its restart plans, after the fourth postponement of the reopening of the main airport.  It has 102 airliners, and planned for 10% to be put back into operation at restart, but now the airline says that maybe only 3 or 4 would be required. This is compared to around 350 take offs and landing daily before the crisis began.  Even if the restart begins in September, daily flights would not be likely before October.

Meanwhile, another 922 new cases and 23 fatalities, the latter taking us to 1,397 total to date, or a 2.2% death-rate.  There are now 24,576 active cases, far outnumbered by the 38,218 “recovered” (with another 902 added today).  1,453 remain in hospital, 161 in ICU, with 23,123 isolated – 666 in hotels and 22,457 at home.  Also notable that, of the 64,191 cases to date, some 73% were in the 20 to 59 age range – where the fatalities are proportionately the least…

30 July 2020

UNIVERSITY OF TEXAS IN FBI PROBE OVER CLAIMS CHINESE GOVERNMENT TRIED TO ILLEGALLY OBTAIN CORONAVIRUS RESEARCH

On 29 July, the South China Morning Post reported that an American university whose work has contributed to some promising Covid-19 vaccine candidates has been contacted by the FBI over allegations that the Chinese consulate in Houston had sought to obtain such research.

https://www.scmp.com/news/china/diplomacy/article/3095242/university-texas-fbi-probe-over-claims-chinese-government

US AUTHORITIES APPREHEND KAZAKHSTANI MAN WANTED FOR EMBEZZLEMENT

A news release from US Immigration & Customs Enforcement advised that Sanzhar Ordaliyev, 33, a citizen and national of Kazakhstan wanted by authorities in his home country on embezzlement charges has been apprehended. In October 2018, he entered the US as a non-immigrant visitor with authorisation to remain in the country for a temporary period. He failed to depart as required, thus violating his non-immigrant status.

https://www.ice.gov/news/releases/ice-apprehends-kazakhstani-man-wanted-authorities-embezzlement

AN E-COMMERCE TECHNIQUE KNOWN AS “BRUSHING” AND SEEDS APPEARING IN MAILBOXES ACROSS THE US

On 29 July, the Wall Street Journal reported that an e-commerce technique known as brushing is being considered as federal officials look to whether the practice is behind a phenomenon of seeds appearing in mailboxes across the country. The US Department of Agriculture said it is collecting the packages and will test them for anything of concern. Brushing is said to be a technique sometimes used to boost a seller’s ratings by creating fake orders. A seller can do this by paying someone a small amount to place a fake order, or just using another person’s information to place an order themselves.

https://www.wsj.com/articles/brushers-arrange-fake-online-sales-to-enhance-sellers-reputations-11596046717

https://www.hstoday.us/subject-matter-areas/infrastructure-security/recipients-advised-to-report-unsolicited-mystery-seed-shipments/

GERMANY ASKS RUSSIA TO HELP FIND FORMER WIRECARD EXECUTIVE

On 29 July, the Wall Street Journal reported that German authorities have asked Russian officials if Jan Marsalek, the former Wirecard AG executive who ran operations for the fintech company, had entered Russia and on 22 July had requested they act on an Interpol Red Notice issued for his arrest.

https://www.wsj.com/articles/germany-asks-russia-to-help-find-former-wirecard-executive-11596056696

 INDIA: ENFORCEMENT DIRECTORATE MONEY LAUNDERING CASE AGAINST FUGITIVE DEFENCE CONSULTANT SANJAY BHANDARI

On 28 July, NDTV in India reported a second money laundering case filed against Bhandari following the 2017 charges re alleged possession of undisclosed assets abroad and other charges in February 2017. The new case involves alleged kickbacks worth $4.99 million allegedly received by him from South Korean company Samsung Engineering in 2009.

https://www.ndtv.com/india-news/enforcement-directorate-files-fresh-money-laundering-case-against-sanjay-bhandari-2269799

CHINESE BANKS URGED TO SWITCH AWAY FROM SWIFT AS US SANCTIONS LOOM

On 29 July, Reuters reported that a report from the investment banking unit of Bank of China has said that companies should prepare for potential US sanctions by increasing use of its own financial messaging network for cross-border transactions in the mainland, Hong Kong and Macau.  Chinese state lenders have been revamping contingency plans in anticipation of US legislation that could penalise banks for serving officials who implement the new national security for Hong Kong.

https://www.reuters.com/article/us-china-banks-usa-sanctions/chinese-banks-urged-to-switch-away-from-swift-as-u-s-sanctions-loom-idUSKCN24U0SN

LESSONS FROM DEUTSCHE BANK’S EPSTEIN FINE

On 30 July, KYC 360 published an article saying that the consent order involved recounts how the bank went wrong “despite knowing Mr. Epstein’s terrible criminal history”, and offers a number of important lessons for compliance teams reviewing high-risk customers of their own. It appears that, as the Epstein relationship was deemed to be “high-risk” and as he was assessed to be a “Honorary PEP” due to his known links to senior politicians, the Epstein accounts were subject to enhanced transaction monitoring. However, such monitoring did not address the individual risks posed by Epstein.  The article considers the lessons to be drawn from the affair.

https://www.riskscreen.com/kyc360/news/questionable-client-lessons-from-deutsche-banks-epstein-fine

UIGHUR WOMAN SENT MONEY TO HER PARENTS IN AUSTRALIA AND CHINA ACCUSES HER OF FINANCING TERRORISM

SBS News in Australia on 18 July reported that the money was said to be help the parents purchase a house, said to having been sent legally in 2013, but now the woman who sent it is facing a court trial in China.  It is said that everything was fine until 2017, when the Chinese government policy on Xinjiang changed, the woman went missing and we later discovered she was in an internment camp for 10 months and she was arrested in 2019.  Bank statements show a total of A$135,000 was sent to the parents in Adelaide via 3 bank transfers in July 2013, with others by an aunt and uncle, who are also facing terrorism-related charges.

https://www.sbs.com.au/news/this-uighur-woman-sent-money-to-her-parents-in-australia-china-accuses-her-of-financing-terrorism

UAE UPDATED EXPORT CONTROL LIST

On 30 July, the EU Sanctions Blog reported that the UAE Committee for Goods and Materials Subject to Import and Export Control has updated its list of goods and equipment subject to controls. It says that export controls have been placed on a number of dual-use goods, equipment and technologies relating to nuclear materials, sensors, avionics, navigation systems, and telecommunication systems – and as agreed under various international agreements.

https://www.europeansanctions.com/2020/07/uae-issues-updated-export-control-list/

US AUTHORITIES APPREHEND ARMENIAN MAN WANTED FOR FRAUD

A news release from US Immigration & Customs Enforcement on 24 July advised that officers successfully apprehended Gevorg Gasparyan, 38, an individual wanted by the Government of Armenia.  Gasparyan is wanted for swindling committed in particularly large amount, forgery, sale or use of forged documents, and abuse of authority by the employee of commercial or other organisations.

https://www.ice.gov/news/releases/ice-apprehends-armenian-man-wanted-fraud

DEFAULTERS IN UAE MAY BE PURSUED IN INDIA

An article from Al Suwaidi & Company on 29 July warned that, in a historical development of India and UAE relationship, UAE Judgment will be recognized and enforceable in India based on reciprocity as per the Notification issued by Government of India on 17 January.  It says that India and UAE entered into an Agreement in 1999 on Juridical and Judicial Cooperation in Civil and Commercial Matters for the Service of Summons, Judicial Documents, Commissions, Execution of Judgments and Arbitral Awards. However, previously it only applied to service of summons, judicial documents or processes, recording of evidence by means of Letters of Request and/or commissions and execution of decrees and arbitral awards. The article says that the Notification is a turning point in execution and enforcement of civil judgment in India issued against persons in UAE by the Superior Courts – as until now it was extremely difficult, costly and time-consuming for the Judgment Creditors in UAE to recover the judgment amount if the debtor had fled to India.

https://www.alsuwaidi.ae/be-aware-defaulters-in-uae-may-be-pursued-in-india-2/

DISCLOSURE: DOCUMENTS HELD BY A SUBSIDIARY MAY BE WITHIN THE “CONTROL” OF THE PARENT AND THE COURT WILL CAREFULLY CONSIDER WHETHER THERE IS A PATTERN OF ACCESS
A item from Addleshaw Goddard LLP on 28 July is one of its “Briefest Case” newsletter for Summer 2020, which provides quick updates on court procedural issues for those dealing with disputes in courts in England & Wales. The item says that the judgment in question is significant in its detailed guidance on the extent of the obligations of a parent company to disclose documents held by subsidiaries. It shows that the court will undertake a careful analysis of arrangements between parent companies and subsidiaries where necessary to assess whether documents are within the parent’s control. The analysis of the 3 elements of consent cited is said to be particularly useful.

https://www.addleshawgoddard.com/en/insights/insights-briefings/2020/litigation/the-brief-case/the-briefest-case/

RUSSIA CONSIDERS EXPANSION OF ITS SANCTIONS REGIME AGAINST UKRAINE

On 29 July, an article from Baker McKenzie reported that on 28 July the State Duma of Russia saw a Draft Bill introduced proposing additional Russian counter-sanctions, which would modify existing sanctions, and also provides for the extensive list of organisations that are bound to block the assets of the sanctioned persons (which includes banks, insurers, non-state pension funds, market participants and some rather specific organizations, e.g. pawnshops and gambling organisers).

https://sanctionsnews.bakermckenzie.com/russia-considers-expansion-of-its-sanctions-regime-against-ukraine/#page=1

BREXIT MODEL PUTS FLOWER SECTOR AT RISK

On 28 July, an article in The Florist reported that the Fresh Produce Consortium (FPC) is calling on Government to avoid a ‘perfect storm’ in 2021 with its Chief Executive taking the lead on making sure flower and plant sales are protected. It is said that unless the UK Government changes its proposed plans for future trading with the EU it will damage the UK plant and cut flower industry, create shortages and increase prices for UK consumers. FPC has been asking the Government to provide essential information which is missing from the Border Operating Model and the Northern Ireland Protocol e.g. will consignments need pre-notification and checks, where consignments will be cleared and whether these facilities will be resourced properly to avoid delays and increased costs.

https://www.theflorist.co.uk/the-florist-magazine-news/2900-half-baked-model-risks-perfect-storm-for-flower-sector-says-industry-body

UKRAINE: AUTHORITIES DISCOVER SCHEME TO SUPLY MILITARY GOODS TO RUSSIA

On 30 July, Interfax Ukraine reported that the Security Service of Ukraine (SBU) officers have found officials of private companies were allegedly involved in organising a mechanism for the illegal supply of military and dual-use goods to Russia, produced by state-owned defence enterprises. It is said that the illegal supply mechanism was blocked by the department in March.

https://en.interfax.com.ua/news/general/677853.html

EXPERTS FEAR THAT NORTH KOREA COULD BE USING THE CORONAVIRUS CRISIS TO SEEK TECHNOLOGY FOR BIOLOGICAL WEAPONS

On 29 July, Newsmax quoted a former Obama Administration official as warning that the DPRK could buy equipment from Western or Chinese sources that would be necessary for their vaccine effort against the coronavirus, and then next year they could turn around and use it to produce biological weapons.

https://www.newsmax.com/newsfront/north-korea-covid-vaccine-biological-weapons/2020/07/29/id/979631/

REPORTS OF SHIPMENTS OF BELARUSIAN AMMUNITION TO USA DISMISSED AS FAKE NEWS

On 30 July, the BELTA news agency reported that Belarus has not shipped ammunition to the US, according to the website of the State Authority for Military Industry of Belarus.  It says that the Russian-speaking Internet mass media Eurasia Daily published an article claiming that Belarus had started exporting ammunition to the US.

https://eng.belta.by/society/view/shipments-of-belarusian-ammunition-to-usa-dismissed-as-fake-news-132134-2020/

INDIAN CUSTOMS DEPARTMENT BUSTS INCENSE STICK SMUGGLING RACKET

Live Mint in India on 30 July reported that smuggling of agarbatti (incense sticks) was placed on the restricted list in 2019 and customs officials have arrested 2 people in Chennai for alleged smuggling of 162 tonnes of agarbattis.  The idea of listing the product was to encourage small domestic producers of incense sticks which will help in job creation.

https://www.livemint.com/news/india/customs-department-busts-agarbatti-smuggling-racket-11596124622784.html

SRI LANKA NAVY HAS DETAINED A SUSPECT WHO WAS SMUGGLING A STOCK OF DRIED TURMERIC 

The Colombo Page on 30 July reported that Customs had interrogated a person who was suspiciously transferring several delivery sacks whilst on patrols stepped up to combat movement s during the covid-19 crisis. The 20 sacks contained dried turmeric which weighed around 1000 kg.

http://www.colombopage.com/archive_20B/Jul30_1596123870CH.php

NINTH CENTURY LORD SHIVA STATUE SMUGGLED INTO UK IN 1998 WILL SOON BE RETURNED TO INDIA

On 30 July, the India Times reported that an ancient statue of Lord Shiva which was stolen from a temple in Rajasthan and smuggled to the UK.  Now, the priceless idol is all set to be returned to its rightful place in India. It was discovered that the statue was brought to the UK where it was found in the collection of a wealthy private collector.

https://www.indiatimes.com/trending/human-interest/stolen-lord-shiva-statue-returned-to-india-from-the-uk-519185.html

https://www.news18.com/news/india/stolen-from-temple-smuggled-to-uk-rare-shiva-statue-from-ninth-century-will-come-home-today-2744185.html

BIRMINGHAM AIRPORT INSPECTORS FIND JUST ONE TYPE OF FOOD IS THE MOST SMUGGLED

The Leamington Observer on 30 July reported that seizures of smuggled food at Birmingham Airport increased by over 10% last year – the food overwhelmingly smuggled into the airport was found to be Betel leaves. The leaves are used in Paan, a chewing mix popular amongst Indians and Bangladeshis, and is a stimulant and mild psychoactive drug – said to be as strong as 6 espresso coffees.

https://leamingtonobserver.co.uk/news/birmingham-airport-inspectors-find-just-one-type-of-food-is-the-most-smuggled-21471/

MALTA PLUMMETS 60 PLACES IN ONE YEAR IN AML INDEX

On 30 July, The Shift reported that Malta has plummeted 60 places in a year in the Basel Institute’s Anti-Money Laundering Index, dropping from its “low-risk” 113th place in 2019 to 53rd place in 2020. It now places Malta as the country with the highest risk within the EU.

https://theshiftnews.com/2020/07/30/malta-plummets-60-places-in-one-year-in-anti-money-laundering-index/

HONG KONG MONETARY AUTHORITY ISSUES AML GUIDANCE TO BANKS AS PANDEMIC PERSISTS

Regulation Asia on 30 July reported that the guidance sets out key practices banks have been using to manage customer due diligence, resource pressure, and emerging threats in the context of Covid-19. It follows a circular in April in which the HKMA encouraged the use of technology to enable remote onboarding and account opening, as a way to meet the challenges of Covid-19.

https://www.regulationasia.com/hkma-issues-aml-guidance-to-banks-as-pandemic-persists/

GIBRALTAR AND BLOCKCHAIN 2020

On 30 July, Isolas published a briefing says that Gibraltar’s regulatory standards and framework for the regulation of virtual asset service providers (VASP) in the fast-paced and dynamic world of distributed ledger technology (DLT) has been central to the success of Gibraltar’s developed DLT industry. It describes the jurisdictions’ DLT regime, considers the implications of the 5th EU AML Directive and FATF requirements. It claims that Gibraltar is 2 years ahead of international regulatory requirements and indeed regulates far beyond what the international community requires.

https://www.gibraltarlawyers.com/news/blockchain-2020-gibraltar-432

US PROSECUTORS EXPANDING CHARGES AGAINST 2 FORMER TWITTER EMPLOYEES AND THEIR ALLEGED SAUDI HANDLER ACCUSED OF SPYING

On 30 July, TRT World reported that prosecutors believe a Saudi citizen linked to the royal family recruited the former Twitter employees to access internal data about users. The pair are accused of having received gifts, including cash payments, for passing on the data an allegedly intermediary between the Twitter employees and Saudi officials.

https://www.trtworld.com/magazine/us-prosecuting-saudis-for-acting-as-agents-money-laundering-and-fraud-38527

EAST AFRICAN HUMAN TRAFFICKING RINGS EXPAND THEIR OPERATIONS

On 30 July, an article in Defence Web reported that the value chain involved in this criminal network comprised 3 links –

  • regionally based recruitment brokers who ferry people from their respective countries to Kenya;
  • Kenyan-based links who ‘receive’ the people and act as the country’s employment agencies. They move victims from Kenya to the host country; and
  • the counterparts who often pose as foreign employment agencies. They are stationed in the host country and ‘receive’ people sent from Kenya.

Most of East Africa’s human trafficking takes place in and through Kenya, with the trafficking of women and girls from East Africa to the Middle East now being carried out entirely by East Africans, and East African networks appear to want control of the entire trafficking value chain.

https://www.defenceweb.co.za/security/border-security/iss-east-african-human-trafficking-rings-expand-their-operations/

BRITON STUART WHITELEY JAILED OVER £4.9 MILLION IRAQI OIL BRIBERY PLOT

On 30 July, the BBC reported on the jailing for 3 years of a British businessman who was involved in a £4.9 million bribery plot to win oil deals in Iraq. He conspired to pay bribes to state-owned firms and politicians after Saddam Hussein was overthrown after the Gulf War in 2003. had previously been convicted of conspiracy to make corrupt payments alongside fellow businessman Ziad Akle. Both men were managers with Monaco-based energy consultancy Unaoil.

https://www.bbc.com/news/uk-england-humber-53588797

NEW JERSEY PUBLIC UNIVERSITY EMPLOYEE ADMITS ROLE IN $5.3 MILLION PRESCRIPTION DRUG SCHEME

A news release from the US DoJ on 29 July advised that John Cuffari, 58, had pleaded guilty by videoconference to an information charging him with conspiracy to commit health care fraud. He admitted his role in a scheme to defraud public and private health benefits programs of at least $5.3 million for the billing of medically unnecessary compounded prescriptions – specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Cuffari was working as a sales representative for several compounding pharmacies.

https://www.justice.gov/usao-nj/pr/new-jersey-public-university-employee-admits-role-53-million-compounded-prescription-drug

SEVENTH CONSPIRATOR PLEADS GUILTY TO PARTICIPATION IN THE DC SOLAR PONZI SCHEME 

A news release from the US DoJ on 28 July advised that Alan Hansen, 49, had pleaded guilty to his participation in a massive fraud scheme through DC Solar, a solar energy company formerly owned and operated by Jeff and Paulette Carpoff, that defrauded investors of approximately $1 billion. Hansen also pleaded guilty to aiding and abetting money laundering.  He is the seventh person to plead guilty to federal criminal charges relating to the fraud scheme since October 2019.  The Carpoffs pleaded guilty to their roles in the fraud conspiracy and other charges in January 2020.

https://www.justice.gov/usao-edca/pr/seventh-conspirator-pleads-guilty-participation-dc-solar-ponzi-scheme-involving-25b

BANK OF SAN ANTONIO SEEKS TO RECOVER $13 MILLION LOST IN ALLEGED PONZI-TYPE FRAUD SCHEME

An article from Rivard Report on 30 July reported that the bank and a subsidiary, Texas Express Funding, are accusing a former top-level employee of forging documents, arranging kickbacks, and swindling the company out of millions of dollars.  The bank alleges the subsidiary’s former president, Wayne Schroeder, fraudulently induced the bank to purchase millions of dollars of worthless accounts receivables from various businesses.

https://therivardreport.com/bank-of-san-antonio-seeks-to-recover-13m-lost-in-alleged-fraud-scheme

SWISS OPEN CRIMINAL PROCEEDINGS INTO FIFA BOSS AND STATE PROSECUTOR

On 30 July, BNN Bloomberg reported that Swiss prosecutors have asked the federal government to strip the immunity of Attorney General Michael Lauber so they can open a criminal investigation against him over a series of undocumented meetings he held with FIFA boss Gianni Infantino. The possible violations include abuse of public office, breach of official secrecy, and the assisting and inciting of offenders.

https://www.bnnbloomberg.ca/swiss-open-criminal-proceedings-into-fifa-boss-own-prosecutor-1.1473148

THE EVOLUTION OF EITI AND NEXT STEPS FOR TACKLING EXTRACTIVE INDUSTRIES CORRUPTION

On 30 July, a post from the Brookings Institute is the last in a series about the launch of a new report into anti-corruption efforts in the natural resources supply chain.  It starts by saying that, since 2002, one of the highest-profile efforts to increase natural resource transparency in resource-rich countries has been the Extractive Industries Transparency Initiative (EITI), a multi-stakeholder initiative consisting of countries, companies, and civil society organisations.  It says that charting the EITI’s evolution and journey through the mechanisms of transparency, accountability, and participation can illustrate the ways in which truly effective natural resource governance can take root. 53 countries are party to EITI (excludes the US, Trump having withdrawn in 2017). While the EITI’s original focus was on transparency in revenue collection, its “Standard” has expanded to cover a wide variety of resource-related data, including contracts with extractive companies, data on resource production, and extractives-related employment numbers. EITI is largely reliant on others —including “infomediaries,” such as journalists and civil society organisations — to translate technical information (which includes all resource-related disclosures) for a general audience. The post says that EITI has achieved successes in producing high-quality open data across the natural resource value chain in implementing countries. Now, it says, it is time to test new strategies by developing country-adapted and evidence-informed strategies to address corruption and to achieve sustainable development goals.

https://www.brookings.edu/blog/up-front/2020/07/30/the-evolution-of-the-eiti-and-next-steps-for-tackling-extractive-industries-corruption

HOW US SANCTIONS DEPEND ON THE FEDERAL RESERVE

An interesting article from the Center for a New American Security on 29 July says that the Federal Reserve (the US central bank body), acts as global lender of last resort, and is successfully shoring up the resilience of the US dollar system, the bedrock of US economic power. It argues that even uniquely powerful national security tools like US financial sanctions are only marginal in their effect on the dollar system and their use appears to cause little harm to US dollar primacy – although concerns about sanctions’ effects on the dollar have reached the highest echelons of government, and the risk that onerous restrictions would encourage China and Europe to find workarounds to avoid reliance on the dollar. The article considers how the Federal reserve reacted to the effects of the covid-19 crisis. It then points out that there are $23 trillion in outstanding dollar-denominated international debt securities and cross-border loans, while about 50% of trade is invoiced in dollars as are around 40% of international payments – saying that as long as international banks and companies borrow and use dollars on this scale, they will follow US sanctions regulations. The article considers that, in the light of experience (and concerns) over re-imposed sanctions on Iran (and non-adherence by other parties, such as the EU) there appear to be 2 lessons –

  • proponents of using economic sanctions for new, far-reaching goals can take comfort and not worry about endangering dollar primacy with their ambitious plans; and
  • opponents of sanctions can still oppose sanctions on the merits, for example by arguing that while “maximum pressure” on Iran may not have ended dollar primacy, it still appears to have failed to achieves its aims while also causing humanitarian damage.

https://www.cnas.org/publications/commentary/how-u-s-sanctions-depend-on-the-federal-reserve

POLITICIANS AND BUSINESS-PEOPLE WHO LIED UNDER OATH AT TRIBUNALS OF INQUIRY GOT AWAY WITH IT BECAUSE THERE IS NO LAW ON PERJURY IN IRELAND

An article in the Irish Times on 30 July reported that examples of false evidence given at tribunals down the decades was raised as the parliament debated legislation on perjury, on course to be passed earlier this year but lapsed because the general election was called.

https://www.irishtimes.com/news/politics/perjury-legislation-aims-to-tackle-insurance-fraud-1.4317604

AIRBUS SUBSIDIARY CHARGED WITH CORRUPTION OVER SAUDI ARABIA CONTRACTS

On 30 July, Breaking News in Ireland reported that the SFO in the UK had charged the former boss of an Airbus subsidiary with corruption over work the company did for the Saudi Arabian military. Jeffrey Cook, the former MD of GPT Special Project Management, is charged over contracts awarded to the company between January 2007 and December 2012 – as well as a separate charge of misconduct in public office over commission he was paid between 2004 and 2008 while working for the MoD. Corruption charges have also been brought against John Mason, the financial officer and part-owner of GPT subcontractors Simec and Duranton, as well as against GPT itself.

https://www.breakingnews.ie/business/airbus-subsidiary-charged-with-corruption-over-saudi-arabia-contracts-1012754.html

CHINA: POLICE ARREST 27 ALLEGED MASTERMINDS BEHIND $5.7 BILLION PLUS TOKEN CRYPTO SCAM

On 30 July, Coindesk reported that 27 primary suspects thought to be responsible for running the massive Plus Token Ponzi scheme were arrested, together with 82 core members of the scheme. The pyramid scheme is said to have grown to over 3,000 layers since last year and fleeced over 2 million people by using cryptocurrencies as a funding channel.

https://www.coindesk.com/police-arrest-27-alleged-masterminds-behind-5-7b-plus-token-crypto-scam

RUSSIA SANCTIONS UPDATE — OVERVIEW AND ENERGY SECTOR FOCUS (INCLUDING EMERGING RUSSIAN COUNTER-SANCTIONS)

On 30 July, US law firm Morgan Lewis published a July update of its April 2020 presentation which highlights the most recent developments and then provides a detailed overview of the relevant frameworks and their possible implications—including a focus on the energy sector (as of 28 July).   The pdf of the slides are made available (89 in all!).

https://www.jdsupra.com/legalnews/us-and-eu-russia-sanctions-update-67129/

RIJOCK

https://rijock.blogspot.com/2020/07/who-in-malta-will-become-collateral.html

GROWING POOL OF DEFENDANTS IN US FOOTBALL BENEFITS FRAUD SCHEME

On 30 July, OCCRP reported that 6 retired players from the American NFL have been charged in a superseding indictment in connection to a scheme to defraud healthcare benefits for former NFL players. The alleged fraud targeted the Gene Upshaw NFL Player Health Reimbursement Account Plan, which provided for tax-free reimbursement of out-of-pocket medical care expenses that were not covered by insurance and that were incurred by former players, their wives and their dependents. The retired players allegedly submitted some $3.9 million in fraudulent claims.

https://www.occrp.org/en/daily/12881-a-growing-pool-of-defendants-in-us-football-benefits-fraud-scheme

MURDER, DRUGS AND EXTORTION IN TUSCANY’S CHINESE UNDERWORLD

A report from OCCRP on 30 July says that much less is known about Italy’s Chinese organised crime groups than the country’s more famous home-grown mafias, with previous research into Chinese organised crime focusing mainly on the Hong Kong triads and their offshoots in London, New York and California. However, it is said that Chinese organised crime has been operating in Italy since the 1990s, smuggling people and trafficking drugs, but Italian law enforcement has struggled to investigate them, with crimes done within the Chinese community, with only a handful of non-Chinese victims out of hundreds of violent acts. However, the report focuses on a new case, and a network based on a Rome-based transport company Euro Anda SRL, with branches run by front men in Paris in France, Neuss in Germany and Madrid and Barcelona in Spain., with the gang being accused of smuggling counterfeit Gucci, Fendi, Prada, and Dolce & Gabbana goods imported from China around Europe.

https://www.occrp.org/en/investigations/murder-drugs-and-extortion-in-tuscanys-chinese-underworld

JERSEY: BUSINESS CRIME Q&A

On 30 July, Appleby published a Q&A article providing a high-level overview of corporate manslaughter, environmental and health and safety issues under Jersey law.

https://www.applebyglobal.com/publications/business-crime-in-jersey-overview/

HMRC FINDS £3 MILLION OF TOBACCO INSIDE ILLEGAL “FACTORY”

On 30 July, the Wisbech Standard carried an article saying that officers from HMRC, assisted by police, seized 9.3 tonnes of tobacco, including 1.2 tonnes of processed tobacco, which was found in a van that was stopped leaving the factory. Machinery involved in the manufacture of tobacco was also dismantled and removed from the property.

https://www.wisbechstandard.co.uk/news/wisbech-illegal-tobacco-factory-raided-by-hmrc-1-6768478

SEC CHARGES SAN ANTONIO-AREA BUSINESSMAN AND COMPANY FOR RUNNING A FRAUDULENT SCHEME WITH SCORES OF INVESTORS, MANY OF THEM RETIRED SAN ANTONIO POLICE OFFICERS AND OTHER FIRST RESPONDERS

A release on Mondo Visione on 30 July advised that the SEC complaint alleges that Victor Lee Farias and his company, Integrity Aviation & Leasing (IAL), raised $14 million from investors, promising that they would use the funds to purchase engines and other aircraft parts for leasing to major airlines.

https://mondovisione.com/media-and-resources/news/sec-charges-ceo-and-company-with-defrauding-first-responders-and-others-out-of-m/

KUWAIT BANS 14 PROMINENT FIGURES FROM TRAVEL OVER CORRUPTION

On 30 July, the Middle East Monitor reported that Kuwait had ordered an immediate travel ban against 14 public figures over “money laundering” charges, with the names of all the suspects sent “to all authorities at land border crossings and airports to ensure they cannot flee”. They include members of the royal family, 2 former ministers and 4 current deputy ministers, and reports say that bank accounts have been frozen.

https://www.middleeastmonitor.com/20200730-kuwait-bans-14-prominent-figures-from-travel-over-corruption/

MEXICO: CRUZ AZUL PRESIDENT ACCUSED OF MONEY LAUNDERING AND INVOLVEMENT IN ORGANISED CRIME

On 30 July, SI.com reported that an arrest warrant has been issued for Cruz Azul president Guillermo Alvarez, 74, general director of the Cruz Azul cement corporation, which runs the Liga MX soccer club.

https://www.si.com/soccer/2020/07/30/cruz-azul-president-accused-money-laundering-organized-crime

MALAYSIA: MAS SETS OUT SUPERVISORY EXPECTATIONS WHERE AML/CFT CONTROL FUNCTIONS ARE OUTSOURCED

On 30 July, a post from Herbert Smith Freehills reported that on 15 July MAS issued a guidance paper which sets out supervisory expectations of sound practices where AML/CFT control functions are outsourced. The briefing provides a summary of the guidance paper’s key learning points, some of which overlap with the updated Outsourcing Principles proposed by IOSCO.

https://hsfnotes.com/fsrandcorpcrime/2020/07/30/mas-sets-out-supervisory-expectations-where-aml-cft-control-functions-are-outsourced/

WHAT DOES SCHREMS II MEAN FOR THE UK?

On 29 July, Lawfare published an article on the outcome of a European court case, the clash between EU privacy law and US surveillance law and rejection of the EU/US Privacy Shield, and what it might mean for the UK post-Brexit.

https://www.lawfareblog.com/what-does-schrems-ii-mean-uk

COVID-19 TRAVEL BANS ARE BOOST FOR “GOLDEN PASSPORT” MARKET

On 30 July, the World Crunch website carried an article from Le Monde claiming that the
super-rich are buying residency papers and passports from places like Cyprus and Vanuatu to be able to travel — despite quarantines — for health reasons, business or pleasure.

https://worldcrunch.com/world-affairs/covid-19-travel-bans-are-boost-for-golden-passport-market

CANADA: HIGH-RANKING HELLS ANGEL HIT WITH NEW CHARGES IN ILLEGAL GAMBLING BUST

On 30 July, The Star reported that high-ranking Hells Angel biker Rob Barletta, 50, from Ontario has been hit with a new wave of money laundering and fraud charges in a crackdown on illegal gambling. He was already awaiting trial after being arrested in December and charged with bookmaking, firearms offences and tax evasion, and was also one of 28 people charged in January in which 228 charges were laid relating to guns, gambling, participating in organized crime and tax evasion.

https://www.thestar.com/news/gta/2020/07/30/high-ranking-hells-angel-hit-with-new-charges-in-illegal-gambling-bust.html

SEC CHARGES FORMER GEORGIA STATE LEGISLATOR WITH DEFRAUDING AT LEAST 100 INVESTORS IN PONZI SCHEME

On 30 July, a release on Mondo Visione advised that SEC alleges that from 2017 to 2019, he fraudulently raised at least $23 million by selling promissory notes to investors – primarily Indian-American professionals – that he guaranteed would provide high annual rates of return – using Allied Energy Services LLC.  In 2019, the alleged scheme collapsed when he failed to make promised interest payments to several investors and then failed to repay the investors’ principal.

https://mondovisione.com/media-and-resources/news/sec-charges-former-georgia-state-legislator-with-defrauding-investors-in-ponzi-s/

UK: CONSULTATION TO UPDATE VICTORIAN-ERA TRANSFER OF OWNERSHIP RULES

On 27 July, the Law Commission announced consultation on draft legislation that would reform and simplify Victorian-era rules on when consumers acquire ownership of goods under sales contracts; and clarify rules used when consumers have ordered goods online or where a retailer goes insolvent before the consumer has received the goods. The consultation closes on 31 October.

https://www.lawcom.gov.uk/project/consumer-sales-contracts-transfer-of-ownership/

MARITIME CRIME DURING THE PANDEMIC: UNMASKING TRENDS IN THE CARIBBEAN

On 30 July, an article from the Center for Maritime Security says that, since the onset of the COVID-19 pandemic the Caribbean’s maritime domain has garnered widespread attention on three fronts: cruise ships stuck at sea, a major increase in US naval presence countering narcotics trafficking (particularly via semi-submersible), and shipments of sanctioned fuels and goods from Iran to Venezuela.  It says that examination of events and trends can bring to light previously overlooked activities and new criminal trends in the region.

http://cimsec.org/maritime-crime-during-the-pandemic-unmasking-trends-in-the-caribbean/45014

CHINA IS GIVING ANCIENT SILK ROAD TRADE ROUTES A DIGITAL MAKEOVER

On 27 July, Global Trade Magazine published an article saying that, in 2015, China launched its Digital Silk Road (DSR) initiative and the article says that the DSR is neither well defined nor understood, but it will re-shape the global economy. The article sets out to tell you what you need to know. The DSR encompasses a vast array of tech projects: building the physical infrastructure for 5G networks, laying fibre optic cable, and constructing and equipping data centres. By design, it also includes promoting China’s standards for telecom, satellite navigation, artificial intelligence, quantum computing, and electronic payment systems throughout the countries where DSR projects are underway. DSR projects combine the hard and soft infrastructure that enable the trade efficiencies promised by this next generation of technology.

https://www.globaltrademag.com/china-is-giving-ancient-silk-road-trade-routes-a-digital-makeover/