20th January 2018
INDIA JOINS AUSTRALIA GROUP
The Economic Times in India reports that on 19th January India became the 43rd member of the Australia Group, the group of countries working to counter the spread of materials, equipment and technologies that could contribute to the development or acquisition of chemical and biological weapons by states or terrorist groups. The Australia Group is the third of the 4 non-proliferation and export control groups that has accepted India’s membership. In 2016, India was admitted as a member of Missile Technology Control Regime (MTCR) and this was followed by membership to Wassenar Arrangement in 2017. India’s application for Nuclear Suppliers Group (NSG) membership is pending following China’s objection.
For information on the Australia Group see –
LAUNCH OF INTERNATIONAL PARTNERSHIP AGAINST IMPUNITY FOR USE OF CHEMICAL WEAPONS
The French diplomatic news site reports that, on January 23rd, France’s Minister for Europe and Foreign Affairs will launch the new International Partnership against Impunity for Use of Chemical Weapons. 29 nations will endorse a series of commitments aimed at strengthening their co-operation in the fight against “impunity” for those who use or develop chemical weapons. They will agree to make any information they were able to obtain on the perpetrators of chemical attacks available to the international community, international investigative organisations, and the public. A dedicated website will be launched. This partnership will be open to all nations that wish to endorse its objectives. Although chemical weapons had disappeared for some 20 years, their reappearance in Iraq, Syria, and Asia, where they have fallen into the hands of state and non-state actors, demands a resolute mobilization by the international community.
France Diplomatie says that, since 2012, international investigation mechanisms, the press and NGO have reported several hundreds of chemical attacks. Nearly 14,000 people have allegedly been exposed to toxic substances and several hundred have been killed. These repeated attacks are a cause for concern because they compromise the prohibition of the use of chemical weapons.
For more information on the Partnership see –
It plans to –
- collect, compile and facilitate the sharing of information so that the perpetrators are one day held accountable for their actions;
- publish online on a website the names of individuals and entities involved that have been sanctioned with the clear intention of naming and shaming;
- use all the existing mechanisms, provide all documentation available to identify the perpetrators of the attacks and support multilateral efforts to impose sanctions;
- create an intergovernmental cooperation forum to document the use of chemical weapons, encourage the sharing of information and support a common position;
- help countries in need to build their capacity to prosecute the perpetrators.
THE US IS REVISING ITS DRONE EXPORT POLICY. WHAT DOES THAT MEAN FOR EAST ASIA?
On 20th January, The Diplomat reports that the Trump administration may be looking to regain dominance of the drone export market. In reporting that the US plans to further revise the pre-existing policy on drone exports, which effectively restricted them to close and reliable allies only, it refers to a 2017 report by the Center for New American Security that highlighted the outdated nature of US drone export policies and how competitors have not only caught up but also and set the US back in the global drone market. Other states, notably China and Israel, have filled the demand for armed drones, it reports, and that China’s various drone types are in high demand among Middle Eastern states. It goes on to say that increasingly drones are becoming the go-to global policy tool against terrorists and insurgents; in some cases, their use against organized criminals has been considered; and that drone strikes worldwide are on the rise and the list of nations conducting drone strikes against terrorists (or suspected terrorists) has expanded considerably since the early years of drone strikes. The market for drones, with China in the lead, is described as “lucrative”.
The CNAS report, “Drone Proliferation: policy choices for the Trump Administration” is available online –
UN TO EVALUATE PAKISTAN PROGRESS ON TERRORIST SANCTIONS
On 20th January, Geo TV in Pakistan reported that a special team of the UN Security Council will visit Pakistan in February and check upon the progress made on sanctions placed on Jamaat-ud-Dawa (JuD), Falah-i-Insaniyat Foundation and other proscribed organisations. It also mentions that there are 27 organisations and 35 individuals operating allegedly from Pakistan on the UN sanctions list (and includes al-Qaeda, Tehreek-e-Taliban Pakistan, Lashkar-e-Jhangvi, JuD, FiF, Lashkar-e-Taiba), and that on 1st January the Pakistani government had banned companies and individuals from making donations to JuD, Falah-i-Insaniyat Foundation, and other organisations on the sanctions list.
INTERNATIONAL FRAUD & MONEY LAUNDERING SCHEME: LENGTHY PRISON SENTENCES IN US
On 19th January, the FBI website reports that a Texas businesswoman and a Texas lawyer were recently sentenced to lengthy federal prison terms for their roles in an international money laundering conspiracy that defrauded dozens of victims across the U.S. Both were also ordered to pay restitution of more than $3.7 million to their victims. It reports that, in October 2017, Priscilla Ann Ellis was sentenced to 40 years in prison, while attorney Perry Don Cortese was sentenced to 25 years. Ellis’ daughter, Kenietta Rayshawn Johnson – who took part in the conspiracy – was sentenced to 40 months. 3 additional individuals were also indicted as part of the conspiracy – 1 pleaded guilty and 2 are awaiting extradition from Canada, with a further 8 other individuals charged separately. Ellis, whilst in jail also tried to solicit other inmates to help her hire a hit man to murder several witnesses who had just testified again her at trial (and then attempted to undertake another financial fraud scheme to pay for the hit man)! The scams ran from 2012 to 2015 and also involved co-conspirators in Canada, Nigeria, South Korea, Senegal and elsewhere.
BULGARIA PARTICIPATES IN OPERATION AGAINST GROUP FOR MONEY LAUNDERING THROUGH ONECOIN CRYPTOCURRENCY
On 19th January, the Focus Information Agency in Bulgaria reports that the Special Prosecutor’s Office (SPO) had said that it was involved in an international operation to neutralise a large-scale pyramid scheme involving fraud, multi-level marketing and money laundering through distribution of OneCoin cryptocurrency following a request for international legal assistance from the Prosecutor’s Office in the German city of Bielefeld received in October 2017. Eurojust and Europol were also part of the operation. The investigation involved Bulgarian company, One Network Services EOOD and its affiliates, and including 2 Bulgarian women with German citizenship. It reports that OneCoin Ltd is registered in the UAE and operates through hundreds of affiliated companies on 4 continents. It was suspected that organised crime groups and terrorist organisations could be funded through the OneCoin scheme. The Bulgarian One Network Services EOOD had functioned as a sales representative of OneCoin Ltd and distributor of its cryptocurrency. The article reports that, companies associated with OneCoin Ltd. are being investigated in UK, Ireland, Italy, US, Canada, Ukraine, Lithuania, Latvia, Estonia and many other countries.
FRAUDSTERS SENTENCED IN SWEDEN FOR SENDING FAKE INVOICCES FOR COMMUNITY TRADE MARKS
On 19th January, the EU Intellectual Property Office reported that on 20th December, the Court of Appeal in Stockholm handed down a judgement in a criminal case against fraudsters who had sent misleading invoices to EUTM owners under the letterhead “OMIH”. The main defendants were sentenced to imprisonment for “completed gross fraud”. The fraud involved sending out of fake invoices, which appeared to have been sent out by OHIM (now EUIPO). The invoices were addressed to several hundred recipients in several countries. All victims had previously applied to register Community Trade Marks with OHIMA summary of the case is available at –
SOUTH AFRICAN DEFENCE FORCES & DEFENCE MINISTRY CORRUPTION AND FRAUD CASES
Defence Web on 20th January reported that 2017 saw the finalising of 44 corruption and fraud cases in the South African Department of Defence (DoD) and Defence Forces. 3 of these were brought to attention by the national anti-corruption hotline with the remaining 41 reported on the DoD’s own anti-corruption hotline. The DoD annual report for 2016/17 notes a total of 178 new fraud and corruption cases reported with by far the majority – 113 – being brought directly to the attention of military police, rather than through the whistleblowing mechanisms of hotlines. More than 10,000 DoD and Defence Forces employees/soldiers attended courses on corruption and fraud education in a further effort to stimulate awareness about these crimes and the detrimental effect they have on operational and other efficiencies.
ANDREY LUGOVOY AND DMITRI KOVTUN FREEZING ORDER 2018
This freezing order, which takes effect from 12 pm on 22nd January, prohibits persons I the UK from making funds available to or for the benefit of Andrey Lugovoy and Dmitri Kovtun, in accordance with relevant provisions contained in the Anti-terrorism, Crime and Security Act 2001. The Order is made on the basis of reasonable belief that action constituting a threat to the life of Alexander Litvinenko, being a national and resident of the UK (and who was poisoned in London in 2006 using polonium-210) has been taken by persons specified in Article 3 of the Order who are judged to be residents of a country or territory outside of the UK (in this case, Russia). HM Treasury believe that this Order will be an effective deterrent to prevent similar activities being undertaken again.
FCA BANS RBS TRADER FOR MANIPULATION OF JAPANESE YEN LIBOR
On 19th January, Shearman & Sterling reports that published a Final Notice in relation to Neil Danziger, a former RBS interest rate derivatives trader, in connection with his involvement in the manipulation of Japanese Yen LIBOR. The FCA imposed a financial penalty of £250,000 on Mr Danziger and prohibited him from performing any function in relation to any regulated financial activity.
HEDGE FUND EXECUTIVE AT OCH-ZIFF FACES OBSTRUCTION AND FRAUD CHARGES IN US
On 19th January, Buckley Sandler reported that the US DoJ had recently unsealed criminal charges against former hedge fund executive Michael Cohen. This follows a civil suit filed in January 2017 against Cohen and others by the SEC regarding FCPA violations, and in 2016, the DoJ and SEC had also pursued a joint FCPA enforcement action against Cohen’s former employer, Och-Ziff Capital Management Group, alleging various bribes, self-dealing, and other malfeasance relating to the procurement of mineral, oil, and other natural resource contracts in African counties. Cohen is alleged to have obstructed the DOJ and SEC’s investigations of Och-Ziff and made false statements, but also to have committed investment advisor fraud.
MORE FLEE CAMEROON’S ENGLISH-SPEAKING AREAS
On 19th January, the UN News Service reported that, as swelling numbers of people flee English-speaking areas of Cameroon for Nigeria, the UN expressed concern over the precarious situation of women and children, which make now up about 80% of the approximately 10,000 registered refugees in eastern Nigeria’s Cross River state. Since mid-2017, Cameroon’s Anglophone regions have seen demonstrations as tensions have mounted over what the country’s English-speakers see as discrimination against them in favour of the majority French-speaking population.
LEBANESE SECURITY AGENCY TURNS SMARTPHONE INTO SELFIE SPYCAM
On 19th January, Defence Web reported that Lebanon’s intelligence service may have turned the smartphones of thousands of targeted individuals into cyber-spying machines in one of the first known examples of large-scale state hacking of phones rather than computers, researchers say. Lebanon’s General Directorate of General Security (GDGS) is said to have run more than 10 campaigns since at least 2012 aimed mainly at Android phone users in at least 21 countries, according to a report by mobile security firm Lookout and digital rights group Electronic Frontier Foundation (EFF), taking control of them to monitor where the user is and to access any data.
US CADAVER DEALER ACCUSED OF SELLING BODIES INFECTED WITH HIV, HEPATITIS
23 ABC News in Bakerfield on 20th January reports that A Detroit cadaver dealer, Arthur Rathburn is accused of deliberately buying diseased human bodies with HIV and Hepatitis and selling them to doctors and dentists who thought they were clean. If found guilty of guilty of wire fraud, false statements to investigators and transportation of hazardous materials he faces a maximum prison sentence of 20 years. His defence told the jury that Rathburn ran a legitimate, lawful and necessary business and he did not have to testify in his own defense. The defense also cautioned jurors not to base their verdict on a mental picture — one of a filthy warehouse, chain saws and white lab coats splatted with blood.
$22 MILLION IRANIAN OIL EMBEZZLEMENT ALLEGED
The Trend News Agency in Azerbaijan reports that the Iranian Oil Minister has echoed reports on a financial corruption case in his ministry, local media reported. The estimated volume of the corruption case is said to be about $22.7 million. The minister added that a worker of the department of oil exploration of the ministry was involved in the case, but had fled the country and the authorities were seeking the assistance of Interpol.
BRITTANY FERRIES TO LAUNCH IRELAND-SPAIN ROUTE
Lloyds Loading List on 19th January said that Brittany Ferries will launch a new route between Ireland and Spain this spring with 2 weekly round trips between Cork and Santander. The French operator said this would represent a first, as currently there were no ferry services linking the countries.
EXPECTED IRISH DEVELOPMENTS IN 2018
Irish law firm Matheson on 19th January published an article predicting some of the events due to occur in 2018 that would be of interest or importance to financial institutions in the country. These included –
- A national central register of beneficial ownership (to be run by the Registrar of Companies at the Companies Registration Office) is scheduled to be launched in Q1 of 2018;
- In April 2018, it is expected that under the Criminal Justice (Corruption Offences) Bill 2017 a body corporate in Ireland may soon be found criminally liable if any director, manager, secretary, agent or subsidiary of the body corporate commits a corruption offence as set out in the Bill with the intention of “obtaining or retaining business or an advantage in the conduct of business for the body corporate”;
- The GDPR comes into force in May 2018;
- On 26th June, a national insolvency register is due to be established to comply with EU law (with all such registers to be connected in or by 2019); and
- A Companies (Enforcement) Bill will seek establish a new independent agency to investigate breaches of company law.
EU RULES CLARIFYING REQUIREMENTS FOR TRACEABILITY AND SECURITY SYSTEMS FOR TOBACCO PRODUCTS
The Lawyer carries an article from Schönherr on 19th January saying that the European Commission has adopted secondary legislation clarifying the requirements for EU-wide tracking and security systems for tobacco products for tracking and traceability (and hence the point of illicit sales), the implementation of which is presumed by Articles 15 and 16 of the new Tobacco Products Directive. An “ID Issuer” will be responsible for generating unique identifiers (codes) to be affixed to unit packets. In addition, all unit packets of tobacco products placed on the EU market will have to be marked with security features comprising at least 5 types of authentication elements. At least one of the elements must be visible to the naked eye, and at least one of the elements must be invisible and only detectable with tailor-made professional tools or laboratory equipment. One of the 5 features must also be provided by an independent third-party provider.
UNODC AND UKRAINE SIGN MOU TO STRENGTHEN PORT CONTROL, FACILITATE TRADE
On 19th January, the UN Office of Drugs and Crime said that to strengthen co-operation under the Container Control Programme (CCP), UNODC and the Government of Ukraine have signed a MoU, agreeing on the establishment of 2 port control units will be established in the Odessa Sea port and at Borispol International airport to undertake specialized profiling, targeting and examining of high-risk containers used to transport illicit goods.
PUERTO RICO CRIME GANG TAKEN DOWN
The always fascinating (if a little unnerving) Insight Crime on 19th January carried an article saying that
US authorities announced drug-related charges on January 18th against 104 alleged members of a Puerto Rico crime group, in a move that could leave a power vacuum in the US territory’s underworld, possibly paving the way for an uptick in violence on the island. The defendants, all allegedly belonging to the “Menores,” or “New Blood” gang, were charged on 9 counts including drug dealing and murder. Amongst the details revealed ion the article, it says that federal officials added that the Menores used the US mail system to launder drug profits through the purchase of US Postal Service money orders. It also claims that Puerto Rico is a strategic point for drug trafficking routes because once inside the US territory, illegal shipments of narcotics that move between the island and the US mainland are subject to less restrictive inspection than imports from foreign countries.
EUROPEAN COCAINE SEIZURES HINT AT NEW POSSIBILITIES FOR COLOMBIA TRAFFICKERS
On 19TH January, Insight Crime reported that major cocaine seizures in Spain, Portugal and Ecuador illustrate the European cocaine pipeline that has become a central part of the operations of Colombian drug traffickers, and could represent lucrative new opportunities for them to move further up the drug supply chain. One example included pineapples in a container shipped via Panama to Portugal, along with 355 kg of cocaine. The Ecuador case involved frozen fish destined for Belgium, along with drugs. With pressure from competing Mexican cartels, Colombian networks have been gradually making up for this shortfall in high-end drug trade profits by seeking out other markets — Europe in particular.
IS PARAGUAY’S EPP EXPANDING ROLE IN MARIJUANA TRADE?
O 19th January, Insight Crime warns that Paraguay’s main guerrilla group, EPP, has displaced hundreds of Mennonite families from an area not far from strategic drug trafficking routes, suggesting the group may be seeking to increase its role in the country’s booming marijuana trade.
US CHARGES HONDURAN CONGRESSMAN WITH DRUG TRAFFICKING
Insight Crime on 19th January reported that authorities in the US have charged a Honduran congressman, Fredy Renan Najera Montoya, with drug trafficking and gun crimes, making him the highest-ranking Honduran politician targeted by US law enforcement in recent years, and adding to the list of political elites in the Central American country tainted by accusations of criminality. He is accused with conspiring to import cocaine into the US, in addition to weapons charges.
PENTAGON’S NEW STRATEGY TURNS TO RUSSIAN AND CHINESE THREATS
Flight Global (an aviation news site) notes that the US Defense Department’s 2018 National Defense Strategy, the Pentagon policy that will drive its budget priorities for the next 5 years, has pivoted away from counter-insurgency operations and toward more sophisticated security threats, such as China and Russia.
HOUSES BOUGHT WITH LAUNDERED MONEY SITTING EMPTY, CLAIMS UK ESTATE AGENTS’ BODY CHIEF
KYC 360 on 19th January carries an article in which the head of an estate agents industry group has welcomed the government’s plans to tackle money laundering by foreign property buyers, saying the issue causes accommodation problems for locals. Mark Hayward, chief executive of the National Association of Estate Agents (NAEA), said: “It’s excellent that this register will be up and running by 2021, ensuring dirty money can no longer be used to buy property under the guise of a shell company.”
Following the recent post of “G Series” chemical weapons, this chart illustrates the “V Series” developed post-WW2.