CHEMICAL WARFARE AND NERVE AGENTS: THE G SERIES
Website Compound Interest, which has some interesting stuff on it, has a cheery infographic focusing on nerve agents in the so-called G series (so named due to their origin, with all of them originally discovered in Germany in the 30s and 40s, the site reports).
PREVIOUSLY BANNED COMPANY DIRECTOR GIVEN NEW, LONGER BAN
On 17th January, CCH Daily reported that Robert Murphy, a director of a London-based construction company, Silverview Developments Ltd, who was previously disqualified for 4 years in 2011, has been banned for 14 years after continuing to run the company with no change in control (despite resigning), along with his mother who has been given an 8-year ban.
GUERNSEY OUTLINES NEW INCENTIVES TO ENCOURAGE RELOCATION TO THE ISLAND
Carey Olsen on 5th January published a briefing set out the plans announced in the island’s annual budget, which was approved on 8th November. These focused on a new tax incentive, making sure there are reliable and affordable sea and air links, and removing barriers for businesses while maintaining the island’s high standards of regulation.
NEW RUSSIAN NUCLEAR WEAPON – THE UNDERWATER DRONE
Defense News in the US on 13th January reported that a draft of the Pentagon’s nuclear posture review confirmed the existence of an underwater nuclear drone made and operated by Russia, a capability the US Defense Department had not previously publicly acknowledged. This is described as an AUV, or autonomous underwater vehicle, called Status-6. The article also says that US intelligence detected Status-6 in November 2016 after it was launched from a Sarov-class submarine, and that Russian sources indicate it has a 100 megaton payload.
FORMER US EXECUTIVE INDICTED IN URANIUM BRIBERY CASE
Corporate Counsel on 16th January carries a report concerning charges laid against the former co-head of a Maryland company with bribing an official of Russia’s state-owned atomic energy company, known as Rosatom, in order to win contracts for his company to transport uranium from Russia to the US. The charges arise from the so-called “Uranium One” case, and involve Mark Lambert, former co-president of Transport Logistics International Inc, on 11 counts, including 7 counts of violating the Foreign Corrupt Practices Act. As previously reported, this case appears to be more a straightforward logistics bribery case, and not one affecting US national security.
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IRAN MISSILES TO YEMEN: IS THERE ROOM FOR CIRCUMSTANTIAL EVIDENCE IN UN SANCTIONS?
The website Pass Blue, which reports on UN-related matters, on 17th January carried a piece pointing to separate items carried in the New York Times and Washington Post about apparent violations of the UN arms embargo on Yemen by Iran- and saying that it was “was probably no coincidence that the articles appeared on the same day that President Trump announced his new Iran strategy”. The article criticises what the author sees as circumstantial evidence being used or accepted by UN experts, and one-sided interpretation based on such evidence by the US.
RUSSIA MIGHT LOSE BILLIONS OF DOLLARS IN IRAQ DUE TO KURDISTAN LINKS
Intersection magazine on 15th January reports that Rosneft’s contracts with Iraqi authorities in Baghdad — and an investment deal with secessionist authorities in Iraqi Kurdistan — are both in jeopardy, and billions are at stake because of its actions last year in the autonomous region of Kurdistan. In October, in a gesture of recognition with the claim for independence, the management of Rosneft signed contracts with the leadership of Iraqi Kurdistan to invest up to $4 billion in the energy sector. The article reports that at least $1.3 billion has already been transferred. However, after the Kurds’ referendum, Iraqi forces retaliated and seized the “disputed” provinces of Kirkuk and Sinjar in October. The Kurds lost 40% of their territory, and nearly two-thirds of their oil and gas reserves. Only 2 of the 5 blocks where Rosneft was supposed to drill are still controlled by the Iraqi Kurds.
ISLE OF MAN UPDATES ISIL/AL-QAIDA AND NORTH KOREA SANCTIONS
For the ISIL/Al-Qaida sanctions: Zayn Al-Abidin Muhammad HUSSEIN, is removed from sanctions lists, and the entry for Seifallah Ben Omar Ben Mohamed BEN HASSINE, is amended.
For the North Korea sanctions: the 4 vessels named in EU Regulation 2018/53/EU are added to the sanctions lists.
MILITARY USE OF CLOUD SERVICES
An article on Quwa.org on 16th January calls for all military stakeholders, from department officials to equipment manufacturers and in-service support providers, to watch out for and respond to movements on 3 fronts in 2018 including the use of Cloud services – saying that developments in cyber-security will help boost military cloud adoption but under the watchful eye of regulations and export control; and the need to be wary of critical data stored in the cloud being accessed by unauthorised personnel. The article reports that, despite challenges and concerns, the US Military have been working on refining its cloud strategy to address information assurance and security concerns. In 2017, IBM announced it was working with the US Army to build and manage a secure private cloud data centre; and the Defense Department has also begun discussions with commercial information technology leaders around updating the rulebook that’s governed its security demands for firms that have provided it with cloud computing services.
NEW CHANGES TO WASSENAAR ARRANGEMENT EXPORT CONTROLS WILL BENEFIT CYBERSECURITY
On 16th January, Forbes Magazine reported that in December, new export control rules for computer network intrusion software were published by the Wassenaar Arrangement, an international body that governs trade in goods with military and civilian (i.e. dual-use) applications for 42 member states. The article points out that offensive network intrusion tools such as exploit toolkits have come under scrutiny by regulators. These tools are sometimes used by regimes with poor human rights and civil liberties records. However, there were complaints that the original Wassenaar rules interfered with the ability of security researchers to disclose information about vulnerabilities to software vendors in other countries in order to get them fixed, those who formulated the rules having thought such disclosures would have been in the public domain. The article refers to new create exemptions for defenders who are engaged in the international co-ordination of information about security vulnerabilities and malware, and the revised rules also create clearer carve-outs for software update mechanisms that have nothing to do with system and network intrusion. These changes are described as “significant improvements and remove many of the obstacles these regulations posed to industry collaboration in the fight against cyber threats”. A problem the article notes is that in implementing the new rules, individual member states may apply or interpret them slightly differently.
E-KYC STANDARDS ISSUED BY CENTRAL BANK OF MALAYSIA
On 16th January, Baker McKenzie reported that in September, the Assistant Governor of the Central Bank of Malaysia (BNM) announced that BNM would issue regulatory parameters for the conduct of electronic KYC (e-KYC) processes for remittance transactions. Then in November BNM issued a supplementary document to its policy document on AML/CFT. This will apply to remittance service providers licensed under the Money Services Business Act 2011 which undertake remittance business through online or mobile channels. The article reports that, in the long term, e-KYC will replace the existing manual and paper-based KYC processes with paperless verification of the customer through the Internet.
NEW CHARGE BROUGHT IN £100,000 FRAUD CASE OF JERSEY LAWYER
On 16th January, the Jersey Evening Post reported that a lawyer who is alleged to have criminally and fraudulently used more than £100,000 of client money is facing a total of 39 charges. It is alleged that the firm K R Manning and Co and Kevin Manning failed to comply with money-laundering laws by not adopting or applying any internal policies or procedures designed to prevent and detect money laundering. https://jerseyeveningpost.com/news/2018/01/17/new-charge-brought-in-100000-fraud-case/#f1FtzGBZ4IUiurKi.99
AUSTRAC OPENS CONSULTATION ON NEW RULES FOR DIGITAL CURRENCY EXCHANGE PROVIDERS
On 16th January, Finance Feeds reported that in Australia AUSTRAC published its draft AML/CFT Rules for consultation, with the consultation period lasting until 13th February. The new draft Rules include detailed information on the Digital Currency Exchange Register, as well as requirements for information to be reported about a threshold transaction.
UK TO SET TIMETABLE FOR DISCLOSURE OF FOREIGN OWNERSHIP OF UK PROPERTY
On 17th January, the Guardian reported that Theresa May will set out a timetable to break the secrecy surrounding the foreign ownership of British property worth billions after facing a House of Lords defeat at the hands of 2 Conservative peers who have been calling on the government to establish a register exposing the beneficial owners of overseas companies and legal entities, and want it done within 12 months. The peers put forward an amendment to the Sanctions and AML Bill, which would have been likely to inflict a government defeat.
CYPRUS JOINS MALTA IN SEEKING ARREST OF WHISTLEBLOWER
EU Observer on 17th January reports that Cyprus has issued an EU arrest warrant against a whistleblower on high-level corruption in Malta. It acted on a criminal complaint against Maria Efimova, the Malta whistleblower, according to the Cyprus Business Mail. It is alleged that Efimova, a Russian national, stole money from Fragrance Distribution, a Cypriot firm where she used to work 4 years ago. Maltese authorities had already alleged that she had defrauded expenses at Pilatus Bank, a Maltese firm where she used to be an intern. She fled Malta in August after telling journalist, Daphne Caruana Galizia (since murdered), that the PM’s wife had a secret account at Pilatus Bank that received dirty money from Azerbaijan.
MEP VOTE IN FAVOUR OF TIGHTER EXPORT CONTROLS ON SURVEILLANCE TECHNOLOGY
EU Observer reports that the European Parliament on 17th January voted in favour tighter rules on the export of cyber surveillance technology through an amendment of an EU Regulation on dual-use technology. Member States, it says, must now formulate their positions for negotiations to begin.
NEW UK-FRANCE IMMIGRATION AGREEMENT
EurActiv reports that France and UK will sign a new immigration treaty at a summit on 18th January), and it will “complement” but not replace the 2003 Le Touquet border agreement, which has drawn criticism in France after the town of Calais became a hub for migrants and refugees. France wants the UK to provide more money and resources to tackle the migrant flows and has suggested that the existing agreement may have to be ended if a compromise or a new set of arrangements cannot be reached. Under Le Touquet, Britain has its border in France and France runs border checks in Britain, a deal that French officials say favours the UK.
MILITANTS’ THREAT TO ATTACK NIGERIAN OIL FACILITIES
Defence Web on 17th January reported that Nigerian militant group, Niger Delta Avengers, said it will launch attacks on the country’s oil sector in the following few days. In November the group, which attacked oil facilities in 2016, said it had ended a ceasefire.
CAMEROON UNREST FUELLING COCOA SMUGGLING
On 17th January, Defence Web reported that unrest in Cameroon’s English-speaking regions, which is said to be the cocoa-growing heartland, is fueling bean smuggling into neighbouring Nigeria, farmers and buyers said. The country has been afflicted by violence since November 2016 after a crackdown on peaceful protests by the Anglophone minority. http://www.defenceweb.co.za/index.php?option=com_content&view=article&id=50408:cameroon-unrest-fuels-cocoa-smuggling&catid=3:Civil%20Security&Itemid=113
UK CONSOLIDATED EXPORT CONTROL LIST UPDATED
On 17th January the UK Department for International Trade issued a news release about Notice to Exporters 2018/1, which reported that the consolidated list of strategic military and dual-use items that require export authorisation has been updated.
NEW RESTRICTIONS ON WHO CAN RUN A CHARITY: PREPARE NOW FOR THE CHANGE
On the Gov.uk blog, Nick Mott (Deputy Head of Guidance & Practice at the Charity Commission) talks about the automatic disqualification rules coming into force on the 1st August, and how you can prepare.
THE UK FORENSIC EXPLOSIVES LABORATORY
The UK Civil Service Quarterly blog carried an interesting entry on the Forensic Explosives Laboratory (FEL), established in 1870 and the world’s oldest one of its kind. It is funded by the Home Office to provide an impartial laboratory that supports the needs of the criminal justice system. Each year the lab investigates around 200 cases, involving around 2,000 pieces of evidence. FEL scientists have supported the investigations into terrorist atrocities, and such other things as the illegal use of fireworks to cause harm to people or damage to property, or people illegally producing explosives in their sheds or kitchens from recipes found on the Internet.
UK IMPLEMENTATION OF EU PORT SECURITY DIRECTIVE
On 17th January the UK Department for Transport published its post-implementation review, summary report of findings and Regulatory Policy Committee report on the UK’s implementation of the EU Port Security Directive, which inter alia extended to an entire port (as opposed to a port facility) the relevant security regime requirements, in order to obtain maximum protection for maritime and port activities.
ALIBABA CLOSED OVER 240,000 ONLINE SHOPS SELLING FAKES IN 2017
Drinks Business on 17th January reported that Chinese e-commerce giant Alibaba closed down over 240,000 online shops selling counterfeit products from designer bags to fake wines during 2017.
FAKE MEDICINES FLOURISH IN AFRICA DESPITE KILLING THOUSANDS
The Daily Mail on 17th January carried a feature on the sale of counterfeit medicines in Africa. It reports that WHO estimates that 1 out of 10 medicines in the world is fake but the figure can be as high as 7 out of 10 in certain countries, especially in Africa. Also, the American Society of Tropical Medicine and Hygiene estimated in 2015 that 122,000 children under 5 died due to taking poor-quality anti-malarials in sub-Saharan Africa, which, along with antibiotics as the 2 most in-demand, are the medicines most likely to be out-of-date or bad copies. In a large operation in August, Interpol co-ordinated the seizure of 420 tons of fakes in West Africa. However, the huge potential profits appeal to the unscrupulous. Labs producing the fakes are said to be chiefly in China, but also include other places such as Indonesia, Poland and Ukraine.
CHECKLIST OF CURRENT UK PENALTIES APPLYING TO TAX AVOIDANCE AND OFFSHORE TAX EVASION AND NON-COMPLIANCE
The Chartered Institute of Taxation has produced a checklist to ensure that members have considered the implications in relation to their practice and their clients.
“NO PAKISTANI BANK INVOLVED IN MONEY LAUNDERING”
On 17th January, Customs Today reported that Minister of State for Finance and Revenue Rana Muhammad Afzal Khan, categorically rejected reports about the involvement of Pakistani banks in money laundering, saying, no Pakistani bank is involved in any sort of act of money laundering… This followed the case of Habib Bank in New York being hit with a large penalty in 2017.
EFFORTS ADVANCE TO COMBAT TRADE IN GOODS MADE WITH FORCED LABOUR – US PERSPECTIVE
After reporting on the UN Security Council voting recently to require UN member states to send all North Korean nationals earning income in their jurisdictions back to North Korea by 22nd December 2019, and reminding one that, in the interim, countries will be able to continue to employ North Korean workers. Sandler Travis & Rosenberg on 17th January remarks that this could pose headaches for US companies sourcing abroad in light of restrictive US sanctions and forced labour laws (which it then goes on to discuss).
MEDICAL CANNABIS PRODUCTS IN JERSEY
On 17th January, the Jersey Evening Post reported that 2 suppliers of cannabis-based products are likely to be reclassified to allow their prescription in Jersey, while Sativex – a cannabis-based painkiller – will be available free of charge when prescribed by a hospital specialist, the Health Minister has said https://jerseyeveningpost.com/news/2018/01/17/assent-for-medicinal-cannabis-products/#axqhz6Tx8UKcQF1W.99
JERSEY WARNING OVER HITMAN THREATS
International Adviser on 17th January reported that Jersey’s regulator and financial crime unit have warned of email threats to send hitmen to people’s homes unless they make a substantial payment in Bitcoins.
AUSTRALIAN AGENCIES RESPONSIBLE FOR THE ENFORCEMENT OF FOREIGN BRIBERY LAWS RELEASE SELF-REPORTING GUIDELINES
Allen & Overy on 15th January published a briefing on recently released joint best practice guidelines that indicate how Australian agencies will approach self-reporting by companies voluntarily seeking to disclose suspected foreign bribery and related offences and provide greater clarity on the expectations of the Australian Federal Police and the Commonwealth Director of Public Prosecutions.
On 16th January the Jurist website published a feature on the International Criminal Tribunal for the former Yugoslavia (ICTY), an ad hoc international criminal tribunal established by mandate from UN Security Council officially came to its end on December 21st. It was created in response to atrocities committed in former Yugoslavia. The feature states that the ICTY, being first international war crimes tribunal established after Nuremberg and Tokyo tribunals, has lived up to the expectations and hopes of the international community. It has successfully discharged its function by strengthening criminal jurisprudence, which will be inherited and taken forward by International Criminal Court.
HIGH COURT APPLIES GUINNESS PRINCIPLES IN RULING THAT DIRECTORS HAVE TO REPAY FUNDS TAKEN FROM COMPANY IN LIQUIDATION
In a briefing, legal news site Out-Law reports that 2 directors of a company which was in liquidation breached their fiduciary duties to the company by taking money out of the business when creditors were being left unpaid. The High Court said that the 1990 ruling in Guinness v Saunders was more relevant in deciding on this issue than the more recent case of Global v Hale. The 2 directors of PV Solar Solutions Ltd were found to be jointly and severally liable to repay the company the sum of £758,020, together with interest.
NEW IRISH GAMBLING LAW BY END OF 2018?
On 16th January, Out-Law reported that new gambling laws could be in force in Ireland before the end of this year, a government minister has said. Plans to update Irish gambling laws have been in place for years (since at least 2013), but have failed to materialise. The government intends to bring almost all forms of betting, gaming and lotteries under one legislative programme for the first time and to create a one-stop-shop licensing regime for all forms of gambling. A new independent statutory gambling authority is to be (probably) set up within the Department of Justice.
EGYPTIAN PROVINCIAL GOVERNOR ARRESTED
Risk & Compliance Hub on 17th January reported that Egypt’s State Security prosecutors have charged Governor of Menufia Hesham Abdul Basset with bribery and wasting public money, the latest corruption case uncovered in the country in recent months.
US REPORT ON MARKETS INVOLVED IN PIRACY AND COUNTERFEITING
Baker McKenzie on 17th January reported that on January 11th the US Office of the US Trade Representative published a report on “notorious markets”. The Notorious Markets List, it reminds one, highlights prominent and illustrative examples of online and physical marketplaces that reportedly engage in, facilitate, turn a blind eye to, or benefit from substantial piracy and counterfeiting. A goal of the List is to motivate appropriate action by owners, operators, and service providers in the private sector of these and similar markets, as well as governments, to reduce piracy and counterfeiting.
APPLE FORCED TO USE CHINSE CLOUD FOR CHINESE CUSTOMSERS’ DATA
On 17TH January, Janes.com reported that US technology firm Apple announced that it would relocate Chinese mainland customers’ (excluding Hong Kong, Macau, and additionally Taiwan) data stored on iCloud, the company’s cloud data storage system, from Apple’s servers in the US to China, said to comply with China’s Cybersecurity Law, enacted in June 2017. This highlights, it argues, indicates increased government control and data embargo risks during diplomatic disputes.
DUE DILIGENCE TO PREVENT CYBER SECURITY INCIDENTS
The Stimson Center, World Institute for Nuclear Security, and law chambers 39 Essex from the UK explore ways nuclear industry actors can demonstrate ‘Duty of Care’ to prevent cyber security incidents, and how this could affect nuclear liability determinations.
MINE BAN TREATY REPORT AND MEETING
The Arms Control Association reported on 10th January that the Mine Ban Treaty (more fully, the Convention on the Prohibition of the Use, Stockpiling, Production and Transfer of Anti-Personnel Mines and on Their Destruction) had added 2 new members in December, as the convention marked 20 years since it was opened for signature Sri Lanka and Palestine. However, at a meeting delegations reacted to a report that casualties from landmines, cluster munition remnants, and other remnants of war had risen to at least 8,605 in 2016, the second year of sharp increases from the 3,993 casualties identified in 2014. The 2016 toll was near the number recorded in 1999, when the treaty entered into force. Much of the increase was due to mines used in armed conflicts in countries such as Afghanistan, Libya, Ukraine, and Yemen, according to the annual “Landmine Monitor” report. The article also noted the use of landmines by armed forces in Myanmar along border crossings with Bangladesh and the resulting harm to fleeing Rohingya civilians drew international attention and outcry in 2017and the Landmine Monitor report identified Myanmar and Syria (neither of which is party to the treaty, nor is the US –though it says it permits their use only in Korea) as the only countries where it could be confirmed that government forces used landmines in the year prior to the meeting. Non-state armed groups were responsible for much of the new use of mines, often improvised devices (IED), in at least 9 countries.
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NUCLEAR BAN TREATY – BRIEFING
On 17th January the EU Parliament Research Service produced a briefing paper on the UN Treaty on the Prohibition of Nuclear Weapons (the “Ban Treaty”) adopted in July 2017.
HOW TO EXPLORE NETWORKS AND ENTITY METADATA IN THE ICIJ OFFSHORE LEAKS DATABASE
In the second of a 3-part series of articles the ICIJ (the people behind the Panama Papers and Paradise Papers) is publishing on ways to search its database that now includes more than 680,000 entities from 55 secrecy jurisdictions.
THE EFFECT OF EU UKRAINE SANCTIONS ON RUSSIA
On 17th January the EU Parliament Research Service produced a briefing paper on the effect on Russia of EU sanctions over Ukraine – an updated version of its March 2016 briefing. It concludes that most observers agree that sanctions are costing Russia billions of euros a year and holding back a return to higher rates of economic growth.
LEGAL PRIVILEGE IN INTERNAL INVESTIGATIONS: AN UPDATE FROM SWITZERLAND RE MONEY LAUNDERING CASES
Baker McKenzie says that a Swiss Federal Criminal Court shined some light on the Swiss approach regarding the scope of the legal privilege. It starts by saying that Switzerland took a rather narrow approach to the scope of legal privilege in connection with AML investigations in a 2016 case, suggesting that no privilege could be claimed with respect to a bank’s internal monitoring, controlling and documentation duties arising as a matter of prudential regulation, namely in relation to PEP. However, it now seems the appeal courts have reasserted the original, more traditional, position, i.e. that it is generally considered that fact-finding activities required to identify and analyze potential breaches of law must be, and are according to established practice in fact, fully protected by legal privilege.
THE “SIXTH EU AML DIRECTIVE”
KYC 360 on 17th January considers further amendments to EU AML laws that would, inevitably, be referred to as 6AMLD, or the “6th ML Directive”. The main thrust would be the better harmonise AML laws across the EU – the most significant element of 6MLD would be to provide a harmonised list of 22 predicate offences, including environmental crimes.
AUSTRALIA GROUP GUIDANCE – BIOLOGICAL WEAPONS
Produced by the US Government, this guidance is concerned with biological weapons, and potentially very useful is perhaps the sections dealing with related production and testing equipment that a state (or non-state actor) might require – such as fermenters, specialist centrifuges etc.