Day: December 30, 2017
THINGS YOU MAY HAVE MISSED: DECEMBER PART 4
SPAIN EXTRADITES TELECOMS FRAUD SUSPECTS TO CHINA
The Taipei Times reports that a Spanish court has granted China’s request to extradite 93 Chinese and Taiwanese fraud suspects to China based on Beijing’s so-called “one China” principle, following approval for 121 other fraud suspects — including some Taiwanese — to Beijing. A total of 269 suspects were reportedly arrested in connection with the case in December last year. The deportation orders were made in accordance with an extradition treaty signed between Beijing and Madrid in 2005 and ratified in 2006.
www.taipeitimes.com/News/taiwan/archives/2017/12/24/2003684554?src=ilaw
US COURT RULES THAT BAN ON ELEPHANT TROPHIES BROKE RULES
Law 360 reported on 23rd December that a court in Washington ruled that the Obama Administration had not followed the proper process when imposing a new rule that banned imports of sport-hunted African elephant trophies from Zimbabwe, in a case arising from a challenge by the Safari Club and the National Rifle Association to the moratorium imposed by the Obama Administration.
SOUTH AMERICA SOCCER OFFICIALS CONVICTED IN US
Law 360 reports that a US federal court has found the former heads of the Paraguayan (Juan Angel Napout, 59) and Brazilian (Jose Maria Marin, 85) soccer associations guilty of racketeering conspiracy and other charges, in a case over the men’s alleged roles in schemes where sports marketing companies funnelled hundreds of millions of dollars in bribes to more than 2 dozen soccer officials.
24th December 2017
US SANCTIONS CHINESE OFFICIAL FOR RIGHTS ABUSES
China Digital Times on 23rd December carried a story about the former Beijing police chief, Gao Yan, being placed on a US sanctions list under the so-called Magnitsky Law over his role in the death of veteran human rights activist Cao Shunli, whom he oversaw at the Chaoyang Detention Centre prior to her death in 2014. The sanctions block the targeted individuals’ assets under US jurisdiction and bar most Americans from any kind of financial transaction with them.
ZIMBABWE TO MAKE IT UNLAWFUL FOR ANY INDIVIDUAL OR BUSINESS TO HOLD MORE THAN $10,000 IN CASH
Pindula News in South Africa reports that the Reserve Bank of Zimbabwe (RBZ) is working on amending the Bank Use Promotion Act and other AML laws so that companies and individuals will be allowed to keep a maximum of US$10 000. Any amount over this must be placed in a bank. Companies will still be required to deposit their cash takings at the end of the business day.
MISSING BOSSES OF AIM-LISTED COMPANY AND A £3.2 MILLION MININGSCANDAL
The Mail Online carries a story saying that arrest warrants have been issued by the Zimbabwean authorities for 2 former bosses of a listed mining company over an alleged fraud. Yat Hoi Ning and Yim Kwan, the former CEO and former finance director respectively of ASA Resource Group, have been missing for several months. The company, which is listed on the AIM market in London, has a Zimbabwean gold mine as its main asset, and also has copper mines in the Democratic Republic of Congo (DRC). It revealed in April that $4.3 million had gone missing and had fired Ning and Kwan. The firm, which went into administration in July, has been unable to contact Ning since. The arrest warrants centre on $2.76 million which was transferred out of the bank account of one of ASA’s subsidiaries. http://www.thisismoney.co.uk/money/news/article-5209281/Wanted-Missing-bosses-company-listed-AIM-market.html#ixzz529oLsuf8
MORE ON THE BRITISH COLUMBIA CASINOS MONEY LAUNDERING CONCERNS
The Times Colonist in Canada on 21st December carried an article providing more background on the recent concerns about the use of British Columbia casinos for money laundering. It reports that a review of gamblers placing massive bets in B.C. Lottery casino slot machines has raised concerns about the “effectiveness and/or existence of controls to monitor slots for money laundering”, and that a B.C. gaming policy and enforcement branch review of BCLC slot machine play was triggered by the 2016 B.C. Civil Forfeiture Office case against Michael Mancini, who claimed he legitimately won about $2.2 million in one year of playing B.C. casino slot machines — and, it was alleged, was frequenting BCLC casinos “for the sole purpose” of laundering money obtained through drug trafficking. In response to Mancini’s case, B.C. gaming enforcement investigators conducted a review of the 10 top slot machine players in BCLC casinos, in terms of large cash transactions in the year to April 2016. The review counted only the 50 most recent transactions exceeding $10,000, for each player, but these alone accounted for $33 million in disbursements, most of which were slot jackpots paid out in cash. Casino experts say that gamblers can submit slot machine vouchers into ticket redemption machines and receive cash back in exchange, and that in this way gamblers do not need to be identified at casino cashier windows. The review also looked at whether slot players could exchange $20 bills for $100 bills.
PHILIPPINES AML/CFT THREAT REMAINS HIGH
On 25th December the Manila Times reported that the country’s financial intelligence unit had said that money laundering remains a serious threat for the Philippines given factors such as regulatory loopholes, legal setbacks and the need for increased co-ordination among agencies. The Anti-Money Laundering Council (AMLC), in its Second National Risk Assessment (NRA) Report covering the 2015-2016 period, evaluated the effectiveness of the country’s existing AML/CFT financing mechanisms.
www.manilatimes.net/money-laundering-threat-remains-high/370535/?src=ilaw
FBI SAID TO BE SEEKING RECORDS FROM FBME BANK IN CYPRUS
The New York Post on 24th December reported that the FBI is seeking the financial records of a bank in Cyprus that was used by wealthy Russians with political connections and is being investigated for money laundering by the US government. It is reported that the FBME bank was tied to special counsel Robert Mueller’s probe into Russian meddling in the 2016 presidential election. FBME, which was based in Tanzania but carried out 90% of its banking in Cyprus before being closed down there, was considered a “primary money laundering concern” by the US Treasury.
https://nypost.com/2017/12/24/fbi-seeks-records-from-cyprus-bank-with-russian-ties/?src=ilaw
26th December 2017
AUSTRALIAN GUIDELINES ON SELF-REPORTING BRIBERY
On 25th December the Fiji Times reported that the Australian Federal Police (AFP) and the Commonwealth Director of Public Prosecutions (CDPP) had released a new joint guideline to assist corporations in self-reporting foreign bribery. The AFP and CDPP Best Practice Guideline: Self-reporting of foreign bribery and related offending by corporations, provides a clear framework for self-reporting suspected incidents. The guidelines are available at –
https://www.afp.gov.au/sites/default/files/PDF/AFPCDPPBPG-SelfReportingOfForeignBribery.pdf
The AFP also publishes an information sheet providing foreign bribery and money laundering indicators –
CHINESE WATCHDOG WARNS STATE BUSINESSES ON OVERSEAS BRIBERY
On 25th December, Reuters reported that China’s corruption watchdog, the Central Commission for Discipline Inspection, has urged state-owned enterprises to guard against the risk of corruption in their overseas entities, saying it was a key task of every company’s Communist Party cell. It said it had published guidance instructing state firms to deal with such risks that could arise from their overseas personnel and decision-making.
5 TIMES MORE TERRORISM CASES IN GERMANY IN 2017
Politico reported on 23rd December that Germany’s federal public prosecutor in 2017 launched 5 times as many terrorist cases than in 2016. It said that a spokesperson for the prosecutor’s office said it had started around 1,200 proceedings involving suspected terrorist acts. About 1,000, were connected with suspected Islamic extremism. In 2016, there were about 250 cases, of which 200 involved suspected Islamic extremists.
ARCADE MACHINE FRAUD CASE IN JAPAN
Just to show it is not just high rollers and casinos that might be tainted by criminality…the Mainichi daily in Japan reported on 25th December that a new arrest has been made in the case of an arcade operating company suspected of fraud for rigging their claw machines so it was impossible to win. Previously, 5 employees of the company and the president, had been arrested on charges of fraud for setting up the machines so that it was impossible for customers to win. The new arrest on the same charge is of an assistant to the president who instructed the arcade employees in the alleged scam. He has said he had other workers “lure in tourists,” and police believe that they mainly went after travelers who were unlikely to make trouble later.
http://mainichi.jp/english/articles/20171225/p2a/00m/0na/010000c?src=ilaw
IRANIAN ATTEMPTS TO MAINTAIN ITS “TOP GUN” FIGHTERS
In the Autumn 2017 edition of Strategic Trade Review published in December (subscription required), there is an article detailing the manoeuvres and smuggling rings used by the Iranians to maintain the fleet of F-14A Tomcat fighters (think Tom Cruise in “Top Gun”) acquired from the US when the Shah was in power. Saying that this area has received less attention than Iranian attempts linked to missiles and nuclear technology, the article argues that examining what happened provides a useful insight into the country’s illicit procurement of military goods.
https://strategictraderesearch.org/subscription/
EU AND US EXPORT CONTROL REGIMES COMPARED
Another article in the Autumn 2017 edition of the Strategic Trade review compares the US and EU approaches to strategic goods export control and how, without an international standard to compare mechanisms to, what nations do is often skewed by their national interests (including commercial ones?).
https://strategictraderesearch.org/subscription/
THE REMITTTANCES BUSINESS
In an article about a Somaliland-born British entrepreneur in the remittances business, NBC News provides some interesting background to the sector. Describing it as not being “a nickel-and-dime business” it reports that more than 247 million people, or 3.4% of the world’s population, live outside of their country of origin as international migrants — and almost all of them send money back to family members at home. International migrants sent more than $441 billion in 2015 alone, 3 times the amount of international aid.
https://www.nbcnews.com/news/world/former-refugee-shaking-441b-remittances-industry-n827361
See also the World Bank Migration and remittances Factbook 2016, with factoids such as –
- The top migrant destination country is the US, followed by Saudi Arabia, Germany, the Russian Federation, UAE, UK, France, Canada, Spain, and Australia. The top 6 immigration countries, relative to population, are outside the high-income OECD countries: Qatar (91%), UAE (88%t), Kuwait (72%), Jordan (56%), and Bahrain (54%)
- The volume of South-South migration stands at 38% of the total migrant stock. South-South migration is larger than South-North migration, which is about 34%
- Smaller countries tend to have higher rates of skilled emigration. Close to 93% of highly skilled persons born in Guyana lived outside that country, followed by Haiti (75.1%), Trinidad and Tobago (68.2%) and Barbados (66.2%)
- Syria was the top source country of refugees in 2014. In Lebanon, refugees made up 35% of the population
- The true size of remittances, including unrecorded flows through formal and informal channels, is believed to be significantly larger than the recorded figures
- In 2015, the top recipient countries of recorded remittances were India, China, the Philippines, Mexico, and France. As a share of GDP, however, smaller countries such as Tajikistan (42%), the Kyrgyz Republic (30%), Nepal (29%), Tonga (28%), and Moldova (26%) were the largest recipients
- High-income countries are the main source of remittances. The US is by far the largest, with an estimated $56.3 billion in recorded outflows in 2014. Saudi Arabia ranks as the second largest, followed by the Russia, Switzerland, Germany, UAE, and Kuwait. The 6 Gulf Co-operation Council countries accounted for $98 billion in outward remittance flows in 2014
- The cost of remittances is the highest in Sub-Saharan Africa and in the Pacific Island countries (for example, it costs more than 20% to send $200 from Australia to Vanuatu, and 19% from South Africa to Zambia). As of the third quarter of 2015, the average cost worldwide remained close to 8% – far above the 3% target set in the Sustainable Development Goals
REAL ESTATE IN AUSTRALIA A “SIGNIFICANT RISK” FOR MONEY LAUNDERING
On 21st December, The Adviser reported that the OECD says that sources in the banking and accounting sectors are warning that Australian real estate is at “significant risk” for money laundering. A report titled Implementing The OECD Anti-Bribery Convention focused on Australia. The report is part of the OECD Working Group on Bribery, which has made recommendations about what the country must do to combat corruption.
https://www.theadviser.com.au/breaking-news/37222-aussie-real-estate-a-haven-for-dodgy-money
FEARS FOR ANOTHER OIL AND GAS RIG MAKER
Nikkei Asian Review reported of the shares in oil/gas rig-maker Sembcorp Marine sliding on the Tokyo exchange even though it has not been indicted on any charges, as investors fear the world’s second-largest maker of offshore oil rigs after Keppel could also face penalties as it too had clinched contracts worth billions from Brazil over the past decade. Keppel’s offshore and marine unit was fined $422 million following a corruption probe involving illicit payments to politicians and officials in Brazil.
https://asia.nikkei.com/Markets/Equities/Keppel-Sembcorp-Marine-shares-fall-on-Brazil-woes?src=ilaw
TACKLING TAX AVOIDANCE AND TAX EVASION: EU SUMMARY OF REPORTS AND BRIEFINGS
On 26th December the EU Parliament Research Service published an update summary as a “Topical Digest” that offers a sample of recent publications and graphics, produced by the European Parliamentary Research Service, on tackling tax avoidance and fighting tax evasion. This covered –
- Understanding the rationale for compiling ‘tax haven’ lists
- PANA committee of inquiry
- Paradise papers’ in a nutshell
- Tax transparency for intermediaries (EU legislation in progress briefing)
- Member States’ capacity to fight tax crimes (July 2017)
- Tax evasion, money laundering and tax transparency in the EU Overseas Countries and Territories: Ex-Post Impact Assessment (April 2017)
- EU-US trade and investment relations: Effects on tax evasion, money laundering and tax transparency (March 2017)
- Fighting tax crimes – Cooperation between Financial Intelligence Units (March 2017)
- The inclusion of financial services in EU free trade and association agreements: Effects on money laundering, tax evasion and avoidance (April 2016)
ZIMBABWE “TO USE INTERPOL TO TRACK DOWN MUGABE ALLIES”
News 24 reports that new Zimbabwean President Mnangagwa reportedly wants to engage the services of the Interpol to hunt down former president Mugabe’s’s allies who “skipped the country when the military toppled the veteran ruler last month”.
ROUGH TIMES FOR SMUGGLERS WHO KNITTED NORTH KOREA TO THE WORLD
On 24th December AP News published an article concentrating on the effect of sanctions on Chinese smugglers who made up to $1,500 per trip for smuggling into North Korea. The article says that increasing international sanctions have left a handful of well-connected Chinese businesses now controlling much of the trade — legal and otherwise — along the frontier. That’s bad news for the small-time smugglers who long dominated the border, and in rare detailed interviews, nearly a dozen people tied to smuggling networks, most either former smugglers or black market traders, say their world has been thrown into turmoil in the years since Kim Jong Un came to power in late 2011.
PALERMO HORSE RACING SUSPENDED DUE TO MAFIA LINKS
On 26th December, KYC 360 reported that horse racing has been suspended at the Palermo racetrack after Italian police investigating mafia activity discovered illegal gambling and evidence that Cosa Nostra bosses were rigging races.
https://kyc360.com/news/italy-horse-racing-suspended-palermo-mafia-links/
UN INVESTIGATING CLANDESTINE OIL TRADING BETWEEN CHINA AND NORTH KOREA
Yonhap news in South Korea reported on 26th December that the clandestine oil trade between North Korea and China is currently being reviewed by the UN Security Council sanctions committee on North Korea, according to the foreign ministry in Seoul. It also reported that Chosun Ilbo newspaper had reported that US reconnaissance satellites found that the 2 countries had engaged in illegal trading of oil by sea on about 30 occasions since October — a sign the neighbours are circumventing UN resolutions that limit the supply of oil to the North.
http://english.yonhapnews.co.kr/northkorea/2017/12/26/75/0401000000AEN20171226007500315F.html
MALTA FIU DEFENDS REPUTATION
On 26th December, Tax News reported that Malta’s Financial Intelligence Analysis Unit, tasked with combating money laundering and the funding of terrorism, has rejected local media claims it may have refrained from investigating private banks due to political pressure.
https://www.timesofmalta.com/articles/view/20171217/letters/The-FIAU-has-always-done-its-duty.665818
TRAINING COURSE IN CHEMICAL WEAPONS FOR CUSTOMS AALYTICAL CHEMISTS
Homeland Preparedness reported that 10 analytical chemists who work in laboratories that support or have plans to support customs services around the world recently completed an Organization for the Prohibition of Chemical Weapons (OPCW) training course in the Netherlands, as part of a new capacity-building initiative for analytical chemists working in customs services. Attendees of the training session learned how to analyze and handle chemicals that are listed under the Chemical Weapons Convention, and also studied the role of customs labs in supporting border controls.
IRAN-RUSSIA BANKING TIES
The Jerusalem Post on 26th December reported that Iran’s central bank is increasingly relying on help from Russia to circumvent sanctions from the US, according to Tehran’s state-run news agency, Press TV. It reports that an agreement had been finalized with Russian counterparts to integrate the countries’ bank card systems. An integrated bank card system will allow Russians and Iranians to use their credit, ATM and debit cards in either/both countries. Iran began issuing credit cards in 2017. This announcement comes 2 months after Iran signed another agreement with Russia’s BPC Banking Technologies to connect its financial network with global payment systems. However, the article does note that the JCPOA agreement calls on countries to assist Iran in integration in return for restrictions on its nuclear industry.
INDIA WANTS NORTH KOREAN LINKS TO CHINA AND PAKISTAN PROBED
The Hindustan Times reports that India considers the nuclear proliferation in North Korea as a threat to its “own national security” and will continue to demand an in-depth investigation into how the country acquired nuclear technology, people familiar with the matter in the Indian foreign policy establishment said, and they maintained that India holds China and Pakistan — both nuclear power nations [and rivals and potential opponents of India] — responsible for the rise of North Korea’s nuclear and ballistic missile programmes and wants the linkages between North Korea and China and Pakistan to be probed by the international community.
27th December 2017
US SANCTIONS RELATING TO RUSSIA AND UKRAINE: NAVIGATING THE CURRENT LANDSCAPE
On 20th December, US law firm Paul Weiss published a useful 15-page briefing to the current US sanctions applying in respect of Russia and Ukraine.
Examples of cases mentioned include, in July 2017, OFAC imposing a $2 million civil penalty against ExxonMobil and 2 of its U.S. subsidiaries for violating OFAC Russia/Ukraine-related sanctions by executing 8 legal documents with Russian oil company Rosneft OAO.
It notes that OFAC has issued an advisory highlighting several practices that have been used to evade or circumvent Crimea sanctions in both the financial services and international trade sectors. For example, it reports that OFAC is aware that certain individuals and entities were engaged in a pattern or practice of repeatedly omitting originator or beneficiary address information from SWIFT messages involving individuals ordinarily resident in, or entities located in, Crimea.
The briefing provides tips, including for non-US financial institutions and non-US companies doing business in/with Russia – to use caution concerning transactions involving US dollars and enhanced diligence to avoid the threat of expanded Russia-related secondary sanctions.
On 6th December the firm provided a video update on US sanctions policy and enforcement –
TRAVEL BANS FOR FORMER HAITIAN PM AND JUSTICE MINISTER IN CORRUPTION PROBE
Reuters reports that Haitian authorities have banned a former Prime Minister Jean-Max Bellerive and former justice minister Camille Edouard Jr from leaving the country as prosecutors lead a corruption probe in which 12 people, including government officials, have been arrested.
BODY PARTS BROKER ARRESTED IN US
Sky News reports that 4 preserved foetuses were among human remains found when the FBI raided the Detroit warehouse of a man accused of running a fraudulent body parts business. Arthur Rathburn, a trader in bodies used for medical research, is due to stand trial in January, having pleaded not guilty to sending customers diseased body parts. The article notes that so-called body brokers take cadavers donated to science, dismember them and sell them for parts, typically for use in medical research and education; and that the multimillion-dollar industry relies largely on the poor, who donate their corpses in return for a free cremation of the body parts that are left over after the corpse is dismembered and partly sold off. Trading in bodies and body parts with the exception of organs used in transplants is said to be legal and largely unregulated in America.
https://news.sky.com/story/foetuses-seized-as-part-of-fbi-body-parts-investigation-11185411
US ANNOUNCES SANCTIONS PURSUANT TO THE GLOBAL MAGNITSKY ACT
On 26th December, US law firms Foley Hoag and Wilmer Hale issued briefings on the list of foreign nationals recently made subject to sanctions under the Global Magnitsky Act, targeting individuals who grossly violate human rights or engage in massive corruption.
https://www.jdsupra.com/legalnews/trump-administration-announces-15438/
https://www.jdsupra.com/legalnews/global-magnitsky-sanctions-target-human-97595/
GREATER TRANSPARENCY FOR UK LOTTERIES
CMS Law carries a brief saying that, following the recent conclusion of its consultation, the UK Gambling Commission announced on 12th December that it will introduce new requirements on lottery operators to increase transparency in relation to the proceeds of lotteries.
HOW PERU SPENT ITS ANTI-DRUGS BUDGET
Insight Crime carries a report which says that a review of Peru’s anti-drug budget by Ojo-Publico.com found that between 2012 and 2017, almost half of the $650 million allocated to anti-narcotic efforts went to the Economy and Finance Department of the National Police, while just 11% went to the unit specialising in drug trafficking.
https://www.insightcrime.org/news/analysis/how-peru-spent-anti-narcotic-budget-past-five-years/
RELIGIOUS INTOLERANCE AND RUGS CRIME IN THE FAVELAS AND PRISONS OF BRAZIL
Insight Crime carried a fascinating article on the drugs trade in Brazil saying that evangelical Protestantism is so far-reaching in Rio that even some of the city’s most notorious drug dealers claim to be spreading the gospel. Some persecute Afro-Brazilian religions, giving the example of one who has a tattoo of Jesus Christ, and is known for “cleansing” his favela of practitioners of Afro-Brazilian religions. It says that whilst a small group of evangelical preachers in Rio de Janeiro’s favelas may have inspired these crusades, but the problem escalated in prisons now grossly overcrowded after a long drugs war.
THE RISK OF A WORRYING, AND COSTLY “SYNDEMIC” ARISING FROM THE US OPIOID EPIDEMIC
The Center for Strategic and International Studies carries a worrying report about the possible implications of the US “opioid crisis”. It says that while America’s escalating opioid epidemic has attracted high-level political attention and intensified media coverage, the knock-on outbreaks of HIV and hepatitis C it inspired in Scott receive relatively modest notice. Yet one ignores these sister epidemics — what it describes as a complex “syndemic” — at your peril.
https://www.csis.org/analysis/americas-dangerous-syndemic/?block2
For general information on the opioid epidemic, see the pages of the CDC. These reveal, for example, that drug overdose deaths and opioid-involved deaths continue to increase in the US, with the majority of drug overdose deaths (more than 6 out of 10) involve an opioid. Since 1999, the number of overdose deaths involving opioids (including prescription ones and heroin) quadrupled. From 2000 to 2015 more than half a million people died from drug overdoses, and 91 Americans die every day from an opioid overdose.
https://www.hhs.gov/opioids/about-the-epidemic/index.html
LOW ENRICHED URANIUM TO REDUCE PROLIFERATION RISKS?
World Nuclear Fuels on 22nd December carried a report that the US National Nuclear Security Administration (NNSA) has submitted to the US Nuclear Regulatory Commission a preliminary report on a new uranium fuel that will enable the conversion of 6 US research reactors from highly enriched uranium (HEU) to low-enriched uranium (LEU). It goes on to explain that the international community is working to minimise amounts of HEU material, which could potentially be used for nuclear weapons. To that end, programmes are under way to convert research reactors to the use of LEU fuel, which does not present a proliferation risk. The article reports that a preliminary safety analysis report submitted by MIT and NNSA to the Nuclear Regulatory Commission shows that a reactor at MIT can safely operate using the new LEU fuel.
www.world-nuclear-news.org/RS-Milestone-for-new-LEU-research-reactor-fuel-2212178.html
The same publication also contains a useful summary of safeguards in the nuclear industry to prevent proliferation, citing NPT, IAEA, NSG etc.
FIRST UAE SPYPLANE
Arabian Aerospace on 27th December carries a report on electronic intelligence aircraft operated or being obtained by UAE, based on business aircraft designs. It says that in addition to its openly acknowledged procurement of 3 Saab GlobalEye airborne early warning aircraft, based on Bombardier’s Global 6000 platform, the UAE is also set to receive 2 further Global 6000 converted for electronic intelligence (ELINT) or signals intelligence (SIGINT) duties under a more secretive programme; and the first of the latter has been has been spotted and photographed undergoing pre-delivery testing at Marshall Aerospace’s facility at Cambridge Teversham Airport in the UK.
http://www.arabianaerospace.aero/first-uae-spyplane-breaks-its-cover.html
MORE ON THE RECENT US MAGNITSKY LAW SANCTIONS
The National Law Review has published a helpful article focused on those persons recently made subject to US sanctions on the grounds of alleged human rights abuses. They include an Israeli billionaire (Dan Gertler) and the “Thieves in Law” criminal organisation.
UK ADDS 17 NEW NAMES TO ITS NORTH KOREAN SANCTIONS LISTS
On 27th December HM Treasury published a notice advising that 17 new names been added to its sanctions lists following the adoption of UN SCR 2397. This “temporary” listing will/should be replaced by a more permanent listing once the names are listed under EU Regulation 2017/1509 (which must be by 21st January).
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/670813/UN_DPRK.pdf
UK CONSULTS ON CHANGES TO ITS COUNTY COURT JUDGMENT DEBT PROCESS
The MoJ has launched a consultation until 24th February on how county court judgments (CCJ) are issued, after concerns were raised that some rogue companies were deliberately sending claims to consumers using incorrect addresses. Credit ratings can be devastated, and the issue may only come to light years later when the individual’s application for a mortgage, loan or car on finance is rejected. Over the past 4 years, the number of CCJ has risen by almost two thirds (59%), with over 1 million issued in 2016.
https://www.gov.uk/government/news/action-to-make-the-process-fairer-on-debt-rulings
OFAC DESIGNATES 2 NORTH KOREANS ALREADY LISTED BY UN
On 26th December OFAC designated Kim Jong Sik and Ri Pyong Chol, for being “key leaders of North Korea’s unlawful weapons programs”. These were already listed by the UN under SCR 2397.
CHINA REPORTS NORTH KOREAN TRADE DOWN
Customs Today reported on 27th December that Chinese customs authorities say the country’s imports from North Korea dropped sharply in November arguing that this suggests that China is implementing the UN Security Council sanctions. China says that the volume of bilateral trade stood at $380 million in November – down 36% year-on-year. Imports are said to have fallen 61% to $100 million, following a similar decline in October, China has not imported any seafood from the North for 3 consecutive months, and coal and iron ore imports have been halted for the second month in a row. China did not export any gasoline to North Korea for the second straight month.
www.customstoday.com.pk/china-imports-from-n-korea-down-61-in-november/
SANCTIONS: FACEBOOK BLOCKS CHECHEN LEADER’S ACCOUNTS, RUSSIA PROTESTS
KYC 360 reports on 27th December that Facebook had blocked the account of Ramzan Kadyrov, the Kremlin-backed leader of Chechnya. He had been recently listed by OFAC under its Magnitsky Law sanctions on the grounds of alleged human rights abuses. Kadyrov is said to have more than 3 million followers on his Russian-language Instagram account and more than 750,000 on Facebook.
https://kyc360.com/news/sanctions-facebook-blocks-chechen-leader-kadyrovs-accounts-russia-protests/
FINANCIAL CRIME PREVENTION IN CHINA 2017
On 27th December, KYC 360 provided a review of financial crime prevention in China during the past year, referring to corruption, cryptocurrencies and correspondent banking.
https://kyc360.com/article/financial-crime-prevention-china-2017-review/
RADIATION EXPOSURE DETECTED IN NORTH KOREAN DEFECTORS
The Yonhap news service in South Korea reported on 27th December that some North Korean defectors, who had lived in areas near the North’s nuclear test site, show signs of suspected radiation exposure in the latest medical check-ups, but it is hard to confirm that the nuclear tests affected them, the unification ministry in South Korea said. Yonhap says that since October, the ministry has conducted nuclear radiation leak tests and health checkups on 30 refugees who previously lived in Kilju County, where the Punggye-ri nuclear site is located. The North has conducted all of its 6 nuclear tests at the site located in the country’s north-eastern province.
http://english.yonhapnews.co.kr/northkorea/2017/12/27/34/0401000000AEN20171227001851315F.html
PARADISE PAPERS FINES IN LUXEMBOURG
Delano in Luxembourg reports that 9 Luxembourg financial institutions have been fined a total of €2 million after investigations based on the revelations of the Panama Papers. CSSF (Commission de surveillance du secteur financier-the watchdog of the financial centre) has imposed fines on 4 banks – CA Indosuez Wealth (Europe), DNB Luxembourg, Nordea Bank and Novo Banco, Luxembourg branch) and 5 other entities – Experta Corporate and Fund Services Luxembourg, Link Corporate Services, Maitland Luxembourg, Pure Capital and Victory Asset Management for “medium or severe breaches” relating to KYC and “know your transactions” obligations. CSSF-appointed external auditors checked 73 banks, with sample on-site reviews of 20% of all corporate accounts related to offshore structures.
http://delano.lu/d/detail/news/panama-papers-fines-9-financial-institutions/165255
MARTIN SHKRELI’S LAWYER CONVICTED
Reuters reports that a New York corporate lawyer who once advised Martin Shkreli (former hedge fund manager who was convicted of 2 counts of securities fraud and 1 count of conspiring to commit securities fraud in August 2017) has himself been convicted on charges he helped the former pharmaceutical executive steal millions of dollars from a drug company to pay back investors in 2 failed hedge funds. Evan Greebel was outside counsel to Shkreli’s former company Retrophin Inc and was found guilty by a federal jury on charges of conspiracy to commit wire fraud and securities fraud.
COURT REFUSES WARRANT FOR FORMER SOUTH KOREAN MINISTER
Yonhap in South Korea reports that a Seoul court has turned down prosecutors’ request for a warrant to arrest Cho Yoon-sun, a former minister and presidential aide to then-President Park Geun-hye on charges of bribery and abuse of power.
http://english.yonhapnews.co.kr/news/2017/12/27/0200000000AEN20171227008100315.html?input=rss
28th December 2017
CZECH REP HAS OLAF REPORT INTO SUBSIDY CASE INVOLVING PRIME MINISTER
The Prague daily Monitor reports that the Czech Finance Ministry received the final report from OLAF on a suspected EU subsidy fraud in the Capi hnizdo. 11 people, including Prime Minister Andrej Babis (ANO) and ANO deputy head Jaroslav Faltynek, are facing charges in the case. Having been released from parliamentary immunity in September, both were re-elected to the Chamber of Deputies and regained lawmakers’ immunity in October. The police asked for their release for prosecution again, but the lower house has not decided on it yet.
http://www.praguemonitor.com/2017/12/28/finance-ministry-receives-eu-report-subsidy-case?src=ilaw
ISRAEL PASSES LAW MUZZLING POLICE
Reuters reports that Israel’s parliament has passed a law barring police investigators from going public with their findings, in what opposition lawmakers saw as a bid to soften scrutiny of corruption probes against Prime Minister Benjamin Netanyahu.
KIDNAPPED VIETNAMESE OFFICIAL ON TRIAL
The Star in Malaysia reports that – the former head of state-run PetroVietnam Construction (PVC) allegedly kidnapped in Germany will go on trial in Hanoi in January on corruption charges in a high-profile case that could see the ex-oil executive face the death penalty, for mismanagement and embezzlement causing massive losses. Vietnam is engaged in an anti-corruption drive and Trinh Xuan Thanh’s was allegedly seized from a Berlin park by Vietnamese security agents in July sparking complaints from Germany. Vietnamese officials said he returned home voluntarily to face the charges.
US IMPOSES SANCTIONS ON HEAD OF NICARAGUA ELECTORAL TRIBUNAL
Telesur reports that the US Treasury has imposed sanctions on Roberto Rivas, the president of Nicaragua’s Electoral Tribunal for alleged corruption and electoral fraud. This follows the overwhelming victory of the governing party in 2016 elections, and despite the OAS endorsing the victory as fair.
UZBEK TAX BREAKS TO SCOTTISH LIMITED PARTNERSHIPS WITH NO IDENTIFIED BENEFICIAL OWNER
The Herald in Scotland carries a report saying that the President of Uzbekistan has granted tax breaks to 2 Scottish Limited Partnerships which have failed to identify their beneficial owners under new UK laws. He has waived all import duties on farm equipment for a new venture in his country’s all-important cotton industry. SLP have been identified as a commonly-used vehicle for money laundering, tax evasion etc.
EUROPOL REPORT: EU SERIOUS AND ORGANISED CRIME THREAT ASSESSMENT – CRIME IN THE AGE OF TECHNOLOGY
This report (aka SOCTA 2017) is available on the Europol website and is intended to provide a detailed analysis of the threat of serious and organised crime facing the EU providing information for practitioners, decision-makers and the wider public. As the sub-title suggests, the report argues that the use of new technologies by organised crime groups (OCG) has an impact on criminal activities across the spectrum of serious and organised crime. This includes developments online, such as the expansion of online trade and widespread availability of encrypted communication channels.
US CUSTOMS’ ARTICLES
US Customs & Border Protection has published the latest edition of its magazine, Frontline. This issue includes articles on –
- Its development of biometrics, including a specially designed, CBP biometric mobile device, the officer took fingerprints of a person’s 2 index fingers
- The work of the National Agriculture Cargo Targeting Unit, or NACTU that looks for threats from products and pests in imports
- Prototypes for Trump’s border wall with Mexico
FORUM NON-CONVENIENS AND ACCESS TO REMEDY IN TRANSNATIONAL BUSINESS AND HUMAN RIGHTS LITIGATION
Law firm Hogan Lovells has published an article which, in part, provides an update on the situation surrounding claims of forum non-conveniens under English law (i.e. a court has the power to dismiss a civil action where an alternative, appropriate and more convenient alternative forum already exists). The article explains that under English law, the appropriate forum is the one in which the case may most suitably be tried in the interests of all the parties and the ends of justice, and it summarises the 2-stage test applied. It explains that for as long as the UK remains bound by European rules on jurisdiction (the Recast Brussels Regulation and Lugano Convention) and subject to the jurisdiction of the ECJ, forum non-conveniens arguments are not available to a defendant domiciled in the UK or another EU state, but this might change post-Brexit.
ASPECTS OF SWISS LAW REGARDING CORPORATE CRIMINAL LIABILITY AND SELF-REPORTING
Bär & Karrer. A law firm in Switzerland, has produced a comprehensive 14-page guide to the above. The guide includes an explanation of the Swiss remedy of reparation – this allows for the prosecutor to withhold any proceedings against the accused if there are no real interests, private and/or public, in prosecuting the matter, and mentions 2 notable cases involving reparation, allowing the cases to be discontinued:
- a prosecution against HSBC based on money laundering charges was discontinued as HSBC paid CHF 40 million; and
- Addax was accused of corruption, but the charges were however discontinued as the company paid CHF 31 million.
The guide concludes that “due to the ongoing global attention focused on fighting white collar crime (aggravated tax misdemeanour is since 2016 also considered as an underlying offence for money laundering) and corruption, Switzerland must expect in future years significant developments in the prosecution of corporate entities”.
CRYPTOCURRENCY EXPERT “KIDNAPPED” IN UKRAINE
Gambling 911 reported on 28th December that authorities in the Ukraine are investigating the kidnapping of 40-year-old Russian programmer and cryptocurrency investor, Pavel Lerner in Kiev. He is the MD of Exmo, described as a major UK-based exchange popular with Russians for accepting rouble payments. He is also well known in Ukraine where he has start-ups dealing with mining operations and blockchain technology development.
http://www.gambling911.com/businessfinancial/crypto-entrepreneur-kidnapped-kiev-.html
On 30th December Gambling 911 announced his release after payment of $1 million in Bitcoin.
INVESTIGATIONS INTO LOTTERIES – STORIES FROM OCCRP
On 22nd December, OCCRP reported that a school in a remote town in South Africa owned by a chicken farmer with a checkered business history was chosen by that country’s national lottery to handle almost US$3.7 million in grant money intended to help poor or under-served communities. It also alleges that anomalies in the records of the national lottery make it difficult to tell how much of the money reached its intended recipients, or whether the school was legally entitled to receive the funds in the first place. The case is an example of the use of a data analysis tool built by OpenUp, a non-governmental civic tech organization, to help journalists easily search through all disbursements made by the lottery since it was launched in 2002. The South African probe is part of a transnational investigation into the worldwide lottery industry by a group of 40 journalists and several publications in different countries.
Another lottery-related OCCRP article, from 14th December, says that a part-owner of the Georgian national lottery has links to criminals in Bulgaria. Bulgarian gaming czar, Vasil Bozhkov, has successfully operated several gambling businesses in his home country and is one of its richest men. He acquired 25% of the Georgian lottery shares in 2017.
MORE STOLEN HIGH-VALUE CARS DETAINED EN ROUTE FROM US TO AFRICA
On 27th December US Customs and Border Protection reported that a further 9 high-end cars had been intercepted in the course of attempted export of most to West Africa.
MONEY FROM BORDER INDUSTRIAL PARK “WAS NOT DIVERTED INTO NORTH KOREAN MILITARY PROGRAMMES”
On 28th December, Reuters reported that South Korea maintained that there is no evidence North Korea diverted wages paid to its workers by South Korean firms in a now-closed Kaesong border industrial park to bankroll its weapons programmes as the previous South Korean government had asserted. A panel of inquiry has contradicted claims of money being transferred by North Korea as it pursues its nuclear and missile programmes, but said would take follow-up steps to boost transparency and public trust in its policy towards the North. South Korea had said last year that most of the cash that flowed into the jointly-run Kaesong complex was being diverted, making the claim when it pulled out of the joint venture in response to the North’s launch of a long-range missile.
http://mobile.reuters.com/article/amp/idUSKBN1EM064?__twitter_impression=true
INSIDE PARAGUAY’S ILLEGAL CANNABIS PLANTATIONS
Insight Crime carries an article about cannabis production in Paraguay, which supplies 80% of the drug consumed in Brazil. Planting it is illegal in Paraguay, but plantations there are still estimated to cover over 7,000 hectares. As usual with Insight Crime, a comprehensive and fascinating article.
https://www.insightcrime.org/news/analysis/inside-paraguay-illegal-cannabis-plantations/
EMERGING TECHNOLOGICAL THREATS IN 2017
The Bulletin of Atomic Scientists on 28th December published an article that comprises a series of existing articles on developments highlighted during 2017 – cyber, autonomous weapons etc
https://thebulletin.org/neuro-cyber-slaughter-emerging-technological-threats-201711378
THE SAUDI-IRANIAN COLD WAR RISKS TURNING HOT
On 24th December the Arab Weekly carried an article arguing that Iran’s actions may reflect an internal struggle inside the country between hawks and more cautious officials. It says, in part, that Like all cold wars, neither side seems to want a direct confrontation, although there may be elements in both Riyadh and Tehran that desire this. Since neither country possesses nuclear weapons, the consequences of a direct Saudi- Iranian confrontation would not be cataclysmic but would still be significant. For Iran, it would mean a de facto war with the entire Sunni Arab world as well as with the US, which strongly backs Riyadh and whose current administration is influenced by people itching for a showdown with Tehran. Iran could also say goodbye to the Western investment that was supposed to flow in after the nuclear deal was signed in 2015.
www.thearabweekly.com/Opinion/9918/The-Saudi-Iranian-cold-war-risks-turning-hot
NEW BRAZILIAN GUIDANCE ON PEP
Baker McKenzie reports that the Brazilian Control Council for Financial Activities (COAF) published on December 9th a new resolution on Politically Exposed Persons (PEP), to enter into force within 90 days after its publication, replacing the previous resolution. It sees the expansion of the list of people defined as PEP, including mayors from all cities (the previous resolution considered only the mayors of capitals as PEP), town and city councilors (previously limited to the president of the city council), state representatives, national presidents and treasurers, or equivalent, of political parties, presidents of courts and councils of municipal auditors, among others. Also affected are “family members to the second degree”, as well as “closest collaborators” who have a straight connection of public knowledge with a PEP, or have business partnership or arrangement, or that participate in legal entities for the benefit of a PEP.
https://globalcompliancenews.com/brazil-politically-exposed-persons-20171227/
GLOBAL MAGNITSKY SANCTIONS TARGET HUMAN RIGHTS ABUSERS AND GOVERNMENT CORRUPTION AROUND THE WORLD
On 22nd December, US law firm Wilmer hale provided a timely and useful briefing on the function of the Magnitsky sanctions being implemented by the US. It explains that the Global Magnitsky Human Rights Accountability Act authorises the President to designate those alleged to be involved in human rights abuses or facilitating corruption. Recently, 52 new names were added to the SDN list maintained by OFAC, with the Act being cited as the basis for their listing.
In the light of the Act, Wilmer hale warns that companies — which already should be focused on anti-corruption and anti-bribery issues — must consider human rights and anti-corruption compliance risks more expansively than ever before, as OFAC is now capable of imposing sanctions that reach commercial and financial relationships in every foreign jurisdiction based on the conduct of foreign government officials. It goes on to say that Magnitsky sanctions are capable of being broad and undefined, raise new compliance challenges, increase a business’s potential exposure in high-risk jurisdictions, and reflect the interaction between the new sanctions type and the FCPA.
Recommended reading.
https://www.wilmerhale.com/pages/publicationsandnewsdetail.aspx?NewsPubId=17179886340
ARMENIAN INVESTMENT FUND DENIES LINKS TO MAN ON US SANCTIONS LIST
Azatutyun website in Armenia carries a report saying that a Russian-Armenian fund planning major business projects in Armenia insisted that it has not received any investments from a controversial businessman blacklisted by the US for his alleged ties to organised crime. OFAC imposed financial sanctions on the ethnic Armenian businessman Ruben Tatulian and 9 other Russian nationals because of their alleged involvement in “serious transnational criminal activities.” Tatulian was among 3 dozen Russian-Armenian entrepreneurs who issued a joint statement in January voicing support for Prime Minister Karen Karapetian. They also pledged to join an investment fund which one of them, the Moscow-based billionaire Samvel Karapetian (no relation to Karen), set up afterwards. The fund, called the Investors Club of Armenia (ICA), formally began its operations in the spring. The ICA’s managing company, Fora Capital, is controlled by Samvel Karapetian.
https://www.azatutyun.am/a/28944140.html?src=ilaw
UKRAINE SEIZES ASSETS OF UMH GROUP
Interfax reports that a court in Kiev has seized the assets of the Ukrainian Media Holding (UMH group), imposed as part of the investigation of criminal proceedings for tax evasion, laundering of the proceeds from crime, organisation of fictitious entrepreneurship, and a number of other crimes. According to the Prosecutor General’s Office, more than 400 resident enterprises of Ukraine were used to ensure criminal activity, most of which had signs of fictitiousness, business entities in offshore zones abroad (Cyprus, Panama, Hong Kong, BVI, Belize), and bank accounts (mainly in Latvia).
http://en.interfax.com.ua/news/general/473574.html?src=ilaw
TURKS & CAICOS PREPARING FOR AML/CFT REVIEW
Tax News reports that the Turks and Caicos Islands’ FSC has reminded licensees of the upcoming 4th Round mutual evaluation of the territory’s AML/CFT regime by the Caribbean FATF (CFATF). Initially planned for March 2018, it has been delayed until September 2018, due to the recent hurricanes that hit the territory.
https://www.lowtax.net/news/Turks-And-Caicos-Gearing-Up-For-Money-Laundering-Review-76085.html
ATTACK ON CUSTOMS OFFICE ON BOLIVIA-CHILE BORDER
Janes.com reports that on 25th December, a group of about 60 individuals armed with assault rifles and explosives breached a 6-metre wall at a customs office’s warehouses in Tambo Quemado in the Bolivian border with Chile to steal a contraband truck seized by Bolivian authorities 4 days earlier. In addition to the truck, the individuals took laptops, tablets, and other electronic devices stored at the warehouses – worth about $208,000.
US DEPORTS AUC DRUG TRAFFICKER TO COLOMBIA
Homeland preparedness on 28th December reported that the US had deported the former leader of the Autodefensas Unidas de Colombia (AUC) drug-trafficking ring to Columbia after 8 years in federal custody for conspiracy to import and distribute cocaine in the US. Hebert Veloza Garcia, 50, had previously admitted in Colombian court that he took part in or ordered dozens of murders during his 10-year reign as a leader of AUC. He was convicted in the US in 2009 on charges of conspiracy to import and distribute cocaine and distributing cocaine.
29th December 2017
WHY FACEBOOK & INSTAGRAM BLOCKED ACCOUNTS OF CHECHEN LEADER
VoA reports that Facebook says it blocked the social-media accounts (Facebook and Instagram) of Ramzan Kadyrov because it had the “legal obligation” to disable them as the Kremlin-backed Chechen leader had become subject to financial and travel sanctions imposed by OFAC on 20th December. He and Russian authorities have reacted angrily.
CHINA REPORTED TO HAVE TESTED NEW HYPERSONIC WEAPON SYSTEM
Popular Mechanics repeats a story from The Diplomat saying that China tested a new missile that incorporates a hypersonic weapon system – the DF-17 (Dong Feng 17, standing for “East Wind 17”). The article explains that hypersonic glide vehicles are carried on a ballistic missile like a conventional warhead (or are launched from an aircraft at very high altitudes) and stop short of entering space, gliding back down to Earth at hypersonic (Mach 5+) speeds. They are said to be capable of evading conventional radar systems trying to detect ballistic missiles.
HOME OFFICE DISQUALIFIES 20 DIRECTORS IN COUNTRY-WIDE ILLEGAL WORKING CRACKDOWN
On 27th December, Bird & Bird issued a briefing saying that the Home Office has also recently exercised its power to issue disqualification orders for 20 directors of 16 businesses in a new countrywide crackdown on illegal working. 18 directors received 6-year disqualifications, and 2 received 7-year bans, with fines totalled £505,000, an average penalty of between £10,000 and £15,000 for each illegal worker.
https://www.twobirds.com/en/news/articles/2017/uk/frontline-uk-employment-law-update-dec-2017
CHINA BAN ON IVORY SALES
Reuters reports that a ban on ivory sales in China, the world’s largest importer and end-user of elephant tusks, takes effect on 31st December with wildlife activists calling it a vital step to reducing the slaughter of the endangered animals. China has allowed the sale of pre-CITES Convention ivory, which refers to products such as carvings and crafts acquired before the 1975 Convention, as long as it is accompanied by certificates.
MORE TERRORISM-RELATED OFFENCES TO BE OPEN TO CHALLENGE UNDER UNDULY LENIENT SENTENCE SCHEME
The MoJ in the UK announced on 29th December that 9 further terror-related offences will be added to the scheme w.e.f. 29th January which allows for a challenge to “unduly lenient” sentences handed out by the courts, following an extension in July which already added 19 terror offences to the scheme. January 2018 will see the first case referred to the Court of Appeal by the Attorney General, made possible through the expansion in July. The new crimes to now be added include instances where a person learns of terrorist activity through their trade, profession or employment, and fails to report this information to the police. For example, an accountant discovering a client may be funding terror. They also include offences related to breaching orders imposed to protect the public from terrorism, for instance someone suspected of involvement in terrorist activity overseas, who returns to the UK, in breach of travel restrictions. Under the scheme, the Attorney General has 28 days to consider the sentence and make a decision whether to refer. If the AG decides to refer the case to the Court of Appeal to review the sentence, the court can decide whether the sentence should stay the same, or if it is unreasonably low, can increase it.
See SI 2017/1328 –
http://www.legislation.gov.uk/uksi/2017/1328/contents/made
SOUTH KOREA SEIZES HONG KONG VESSEL FOR SHIP-TO-SHIP OIL TRANSFER FOR NORTH KOREA
Yonhap News reports on 29th December that a Hong Kong-flagged vessel has been seized and inspected by South Korean authorities after secretly transferring oil to a North Korean vessel in international waters in a ship-to-ship transfer prohibited by UN sanctions. “Lighthouse Winmore” entered Yeosu Port on November 24th after allegedly transferring 600 tons of refined petroleum to a North Korean vessel on October 19th. UN SCR 2375 bans ship-to-ship transfer of any goods for North Korea, and UN SCR 2397 allows the capture and search of a vessel suspected of engaging in prohibited activities with North Korea. The ship is said to be one of 10 that the US had wanted the UN to designate.
http://english.yonhapnews.co.kr/northkorea/2017/12/29/93/0401000000AEN20171229006152315F.html
https://www.bbc.co.uk/news/amp/world-asia-42510783?__twitter_impression=true
UN ADDS 4 NORTH KOREAN SHIPS TO ITS SANCTIONS LISTS
On 28th December the UN Security Council denied international port access to 4 North Korean ships suspected of carrying or having transported goods banned by international sanctions targeting Pyongyang. The ban of the 4 vessels – the Ul Ji Bong 6, Rung Ra 2, Sam Jong 2 and Rye Song Gang 1 – brings total number of blocked ships to 8. The UShad requested the most recent ban along with measures targeting ships registered in other countries, diplomats said on condition of anonymity.
http://www.customstoday.com.pk/un-bars-four-north-korean-ships-from-international-ports/
AML/CFT THREAT IN PHILIPPINES ASSESSED AS HIGH
On 22nd December Payments Compliance reported that the Anti-Money Laundering Council in the Philippines had endorsed the second national risk assessment on the country’s AML/CFT threat levels, these remaining as high. The threat from terrorist financing was also assessed as high. The report says the assessment was approved on 20th December.
CHINESE TAKEAWAY VAT FRAUD AND MONEY LAUNDERING CASE
Gloucestershire Live reports that the founder of a Chinese takeaway chain, Bristol-based Hotcha, being investigated for money laundering was more than £4 million overdrawn when the business entered administration. The business collapsed in October after being raided by HMRC in an alleged £35 million money laundering case. Investigation for suspected VAT fraud and money laundering are said to be ongoing.
INDIA SAYS ISLE OF MAN (AND OTHERS) FAILED TO RESPOND TO REQUEST IN ALLEGED CORRUPTION CASE
Local media in the Isle of Man carries reports that Indian media sources say that the Indian authorities’ case against a former minister and others on charges of criminal conspiracy were “weakened” after many jurisdictions, including the Island, failed to reply after being asked for assistance. It says that letters were sent to Russia, UAE Norway Cyprus Mauritius, Libya, BVI, France and Singapore in 2010-12, but only France and Cyprus replied. The reports say that authorities, including those in the Island, were said not to be obliged to respond, as a direct link between the proceeds of crime and the request had to be be provided, and seemingly this was not possible.
RUSSIA JAILS MAGNITSKY-LINKED UK-BASED FINANCIER
The BBC on 29th December reports that a Russian court has sentenced UK-based financier Bill Browder – a fierce critic of President Putin – to 9 years’ jail in absentia. It also sentenced a partner of Mr Browder, Ivan Cherkasov, in absentia to 8 years in jail, in the same case. Browder was once one of the biggest foreign investors in Russia, controlling Hermitage Capital Management. He was found guilty of fraud and tax evasion. He got a 9-year jail term in 2013 on similar charges in Russia. He accuses officials of involvement in the death of his lawyer, Sergei Magnitsky, in a Russian jail in 2009. A campaign by Mr Browder led the US to impose sanctions in 2012 on top Russian officials accused of corruption.
http://www.bbc.co.uk/news/world-europe-42513616?src=ilaw
US TO TIGHTEN ITS VISA WAIVER PROGRAM (VWP)
Jackson Lewis has published an article about changes being made to the US Visa Waiver Program (VWP), which allows citizens of 38 countries to enter the US for business or tourism for stays of up to 90 days without obtaining a visa. Previously, in 2015, nationals of eligible countries who had travelled to, or been in, certain Middle East countries after 1st March 2011, or were nationals of Iran, Iraq, Syria or Sudan.
Further changes have now been announced requiring the “full implementation of all existing information-sharing arrangements to screen travellers against US counter-terrorism information databases”. In addition the country must have effective measures against insider threats to aviation, and those with a 2% or greater rate of overstays will have to initiate public information campaigns to reduce violations. The article notes that 4 countries have been identified as overstay violators: Greece, Hungary, Poland, and San Marino, and that approximately 1% of visitors overstay their visas. Other changes being proposed include enhancing systems to collect and analyse data on passenger travel.
https://www.jdsupra.com/legalnews/new-secretary-of-dhs-announces-new-62864/
IRAN’S TANKER CHARTER DEALS INCREASE SHARPLY AFTER SANCTIONS EASED
Customs Today reported on 29th December that the National Iranian Tanker Company (NITC) has signed over 200 leasing contracts for its vessels since the lifting of the Western-imposed economic sanctions 2 years ago.
http://www.customstoday.com.pk/irans-tanker-charter-deals-soar-sharply-in-2-years/
ISTANBUL POLICE “SEIZED OVER 9 TONS OF DRUGS IN 2017”
Customs Today reports that police in Istanbul seized over 9 tons of drugs during anti-narcotics operations in 2017, with the unconfirmed claim that during the operations 9.03 tons of drugs and 5,773,235 drug pills were seized, 45,840 suspects were arrested (of which 193 of the 4,826 remanded in custody were foreigners from 45 different countries.
http://www.customstoday.com.pk/istanbul-police-confiscate-over-9-tons-of-drugs-in-2017/
FRANCE PROPOSES CHANGES IN CORSICA: UNLIKELY TO RESULT IN MILITANCY
Janes.com on 29th December carried a report saying that, with changes to the status of the island proposed, French government failure to grant Corsican nationalists greater autonomy to increase protest risks; but a return to militancy unlikely. This follows the victory of a coalition of 2 Corsican nationalist parties, going under the name “Pe a Corsica” (For Corsica), in a regional election on 10th December, and whose demands include more autonomy on fiscal issues, equal recognition of the Corsican language, amnesty for Corsican “political prisoners”, and controls on the purchase of property in certain areas, restricting the right only to people who have been resident on the island for at least 5 years.
IN UK LAW, WHEN CAN A SEARCH OF A SUSPECT’S PREMISES TAKE PLACE IF NOT ACCEPTED INTO CUSTODY?
PNLD on 27th December posted a Q&A posing the question: a suspect was arrested and transported to a police station. During this transport a section 18 premises search was authorised by an Inspector for the suspect’s home address, and the search was commenced. Custody was refused at the station and the suspect was released. As the search under section 18 had already begun, could it continue after release? The answer is not as easy as you might think (giving that the suspect is not accepted into custody), the answer noting that that there is no case law on the issue of the exact time at which a search under section 18 must cease. After a long-ish discussion, it concludes that it appears that each case needs to be considered on its own facts.
https://www.pnld.co.uk/your-legal-questions-answered/continued-search-under-s18-after-release/
30th December 2017
AMERICAN FRAUDSTER POSED AS NIGERIAN PRINCE
The Nation Online reports that a 67-year-old advance fee fraudster called Michael Neu posing as a Nigerian prince has been arrested by the police in Louisiana. He was said to have duped hundreds of people across the US using emails. Police said he faces 269 counts of wire fraud and money laundering following an 18-month investigation.
PANAMA TO DEPORT MEXICAN GOVERNOR
ANI News reports that Panama has announced that it would extradite a former Mexican governor on charges of corruption. According to the foreign ministry, as quoted by local media reports, Governor Roberto Borge would be flown, which was confirmed by the Mexican embassy. The Mexican authorities will go to Panama and escort him back.
THAI COURT SENTENCES PYRAMID SCHEME FRAUDSTER TO 6,637 YEARS
The Nation in Thailand reports that a criminal court has sentenced a man to 6,637 years on multiple charges involving more than 2,600 victims lured into a pyramid scheme. he and his 2 companies – The System Plug and Play Co, and Innovation Holding Co – were found guilty, he on 2,653 counts each carrying a 5-year jail term – totalling 13,256 years. His confession led to a halving of the sentence – but Thai law only actually permits a maximum 20 years imprisonment.
http://www.nationmultimedia.com/detail/national/30335070?src=ilaw
OECD CONSULTATION ON CRS ANTI-AVOIDANCE RULES
Ross Martin reports on 29th December that the OECD have published a new consultation “Mandatory Disclosure Rules for Addressing CRS Avoidance Arrangements and Offshore Structures”, which looks at introducing rules to reduce cross-border tax evasion by imposing additional reporting requirements. The measures are targeted at arrangements designed to bypass the Common Reporting Standard (CRS) rules, which facilitate the gathering and sharing of information between different tax authorities. The consultation lasts until 15th January.
UK BORDER FORCE SEIZES 22 TONNES OF TOBACCO
An attempt to smuggle almost 22 tonnes of tobacco into the UK has been prevented by Border Force officers at Hull docks. In a news release of 29th December it reported the seizure that took place on 18th December when officers searched an HGV lorry that had arrived at the port from Rotterdam. Officers discovered 33 pallets of large cardboard boxes, which were found to contain unprocessed tobacco. The shipment had been misdeclared as paper.
https://www.gov.uk/government/news/border-force-seize-22-tonnes-of-tobacco-at-hull-docks
NEW REPORT HIGHLIGHTS ISRAEL’S GROWING RELATIONS WITH GULF ARAB STATES
The report from the European Council on Foreign Relations (ECFR) reflects on developments in 2017 that have brought into focus the one-state reality taking hold in Israel-Palestine. This will have unavoidable repercussions for the EU and its member states, it says, underlining the urgent need for bolder and more decisive EU action. It recommends that EU action should include supporting on-the-ground Palestinian sovereignty-building strategies, cementing the contours of a final status agreement, and leveraging Israel’s growing relations with Gulf Arab states to make meaningful Israeli steps towards de-occupation.
RUSSIA ALLEGEDLY SUPPLYING OIL TO NORTH KOREA
On 30th December KYC 360 carried a story saying that Russian tankers have supplied fuel to North Korea on at least 3 occasions in recent months by transferring cargoes at sea, according to 2 senior Western European security sources.
https://kyc360.com/news/russian-tankers-fuelled-north-korea-via-transfers-sea-sources/
MORE PROBLEMS FOR PRESIDENT ZUMA
On 30th December KYC 360 said that South African president Jacob Zuma has been dealt a fresh blow by the Constitutional Court, which ruled that parliament had failed to hold him accountable regarding the misuse of state funds to upgrade his country residence.
https://kyc360.com/article/kyc360-breaking-views-court-trouble-president-zuma-can-still-duck-dive/
AUSTRALIAN BANKS ALLEGEDLY BLOCKING ACCOUNTS LINKED TO CRYPTOCURRENCIES
On 30th December, Cryptovest online reported that at least 4 Australian banks are accused of freezing customer accounts on suspicion of being linked to cryptocurrency activities. The banks are also said to be blocking transfers to several crypto exchanges. It claims that National Australia Bank, ANZ, the Commonwealth Bank of Australia, and Westpac Banking Corporation were blocking client accounts and transfers to several crypto exchanges, including CoinJar, Coinbase, CoinSpot, and BTC Markets.
https://cryptovest.com/news/4-australian-banks-allegedly-freeze-accounts-over-crypto-activity/
PAPUA NEW GUINEA ENCOURAGED TO CONTINUE TO IMPROVE AML/CFT CONTROLS
On 29th December the IMF concluded the Article IV consultation with Papua New Guinea. Such consultations involve bilateral discussions, usually every year, and the visit by a staff team to collect economic and financial information, and discuss with officials the country’s economic developments and policies. The report also encouraged the authorities to continue to improve the effectiveness of the AML/CFT framework.
EXTRADITION REQUEST FOR BELIZE ATTORNEY
Amandala in Belize reports that Belizean attorney Andrew Bennett, 46, became the subject of a US extradition request that was sent to the Belize Ministry of Foreign Affairs. Bennett, who worked as a partner in the law firm of Glenn D. Godfrey, has reportedly been named in a 7-count indictment for money laundering by a grand jury from the District of Puerto Rico. The indictment is dated July 2015. The last extradition request from the US involved the Seawell brothers, Mark and Gary Seawell, who beat the extradition request due to procedural flaws in the warrant that was used to imprison them.
http://amandala.com.bz/news/government-sends-extradition-request-attorney-andrew-bennett/
CHINA TO CAP OVERSEAS WITHDRAWALS USING DOMESTIC BANK CARDS
On 30th December Reuters reported that China’s foreign exchange regulator will cap overseas withdrawals using domestic Chinese bank cards at 100,000 yuan ($15,370) per year in an effort to target money laundering, terrorist financing and tax evasion.
CHINESE CUSTOMS CRACKDOWN ON SEAFOOD SMUGGLING
Customs Today reports that China highest customs authority has spearheaded a nationwide operation against seafood smuggling resulting in 8 smuggling rings involving numerous companies being “smashed”. Among the casualties appears to be one of China’s largest pangasius importers who will face criminal charges after it was implicated in smuggling 41,000 tonnes of pangasius products worth $106 million into China from Vietnam. According to industry sources not based in the country it’s possible the crackdown has resulted in smuggling routes into China from Vietnam being closed, which, in the run up to Chinese New Year, could prove disastrous for Chinese seafood importers which haven’t already taken delivery of product.
Note – Pangasius is a genus of medium-large to very large shark catfishes native to fresh water in South and SE Asia. The term “pangasius” is sometimes used to specifically refer to the commercially important basa fish
http://www.customstoday.com.pk/china-issues-smuggling-crackdown-as-large-pangasius-importer/
CANADIAN COURT ORDER FOR PAYPAL DATA
Customs Today also reports that the Federal Court of Canada has ordered US-based PayPal to hand over details about its business account customers to the Canada Revenue Agency, involving Canadians with PayPal business accounts who processed transactions between the start of 2014 and now. PayPal must hand over the names, dates of birth, information and — in some cases — social insurance numbers of any business account holders in Canada. The company has millions of Canadian customers.
raytodd.blog 