Following up last year’s “Russian Laundromat” story has led to a BBC investigation that links the Eurovision Song Contest, Ukrainian cash and what it describes as “The Great British Money laundering Service”. A File on 4 radio programme was broadcast on 4th February. In the programme, Tim Whewell investigates the scams designed to circumvent new regulations and untangles the global networks behind the Great British Money Laundering Service. It says that new transparency rules designed to reveal the true owners of British companies are being flouted, and billions of pounds of dirty money is alleged to have passed through opaque UK companies in recent years. How, it asks, does this square with UK’s international reputation for financial probity?
Day: February 6, 2018
THINGS YOU MAY HAVE MISSED – FEBRUARY 6
6th February 2018
CALIFORNIA ENGINEER SOLD SATELLITE SECRETS TO “FOREIGN AGENT”
On 5th February a FBI news release tells the story of a California man, Gregory Allen Justice — who had worked for a cleared government contractor in California — and was arrested in a hotel room for selling sensitive satellite information to someone he believed was a Russian agent. Justice had been employed with the government contractor — under its satellite systems programme — since 2000, and assigned to a team working to build and test US military satellites, including projects for the USAF, USN and NASA that involved satellites with communication, navigational, and observational technology. The trade secrets and other technical data he had access to as part of his job related to areas such as satellite operations testing, firmware installed on satellites, and anti-jamming technology. He pleaded guilty in May 2017 to attempting to commit economic espionage, attempting to violate the Arms Export Control Act, and violating the International Traffic in Arms Regulations (ITAR) and in September he was sentenced to five years in federal prison.
https://www.fbi.gov/news/stories/insider-sentenced-for-economic-espionage
PAKISTAN: MONITORING OF EXPORT CONTROL, FORMATION OF LICENCE REVIEW COMMITTEE APPROVED
The Pakistan Observer reports that the federal cabinet has approved the constitution of Licence Review Committee (LRC) aimed at strict monitoring of export control on goods, technologies, material and equipment and biological weapons and their delivery system. It was described as being for timely review of licence applications and related matters and that the committee would comprise ex-officio members from relevant Ministries and Departments, and draft notification of the committee had been vetted by the Law and Justice Division.
https://pakobserver.net/monitoring-export-control-formation-lrc-approved/
ISRAEL’S MINISTRY OF PUBLIC SECURITY IS DELAYING EXPORT LICENSING OF CANNABIS
C Tech on 5th February reports that more than 6 months after an Israeli parliamentary committee recommended to approve the export of medical cannabis from the country, the bid has yet to become law. Concerned by possible leakage of medical cannabis to recreational users, Israel’s Ministry of Public Security is blocking the progress of the country’s cannabis export reform. Export regulations are part of a wider planned cannabis reform announced by the Israeli government in 2016, aiming to legalise and monitor medical cannabis products in the country. As part of the reform, general physicians will be able to prescribe medical cannabis that will be sold in licensed pharmacies throughout the country.
https://www.calcalistech.com/ctech/articles/0,7340,L-3731189,00.html
NIGERIA AT RISK OF EXPULSION FROM EGMONT
The Leadership in Nigeria reports that Egmont group, a global network of 152 FIU is set to expel Nigeria from the global intelligence club by March 2018, reports say. The point in dispute is the argument that Nigeria should separate its FIU from the Economic and Financial Crimes Commission (EFCC). Egmont said that there is high level of interference and meddling by the anti-corruption agency.
https://leadership.ng/2018/02/06/nigeria-risks-ban-intl-financial-transactions-egmont-threat/
BANK OF BARODA DRAGGED INTO SOUTH AFRICA’S POLITICAL CRISIS
The Hindustan Times of India on 6th February reports that a scandal involving the bank’s South Africa operations, a cabal of businessmen of Indian origin (i.e. the Guptas), and South African President Jacob Zuma, have undermined the reputation of India’s second largest bank and resulted in an unprecedented penalty by the South African Reserve Bank.
MOLDOVAN APPLE FARMERS INVOLVED IN TAX EVASION AND MONEY LAUNDERING
Crime Moldova reports that 5 leaders of a criminal group have been detained for money laundering and tax evasion. The scheme involved several farmers who, to avoid paying taxes, contacted the criminal group to falsify accounting records in the marketing of apples or other agricultural products.
https://en.crimemoldova.com/news/crime/farmers-involved-in-tax-evasion-and-money-laundering-/
AUSTRALIAN RACING REGULATOR ORDERS SHUTDOWN OF BITCOIN BETTING PLATFORMS
Casino.org on 5th February reported that the Northern Territory Racing Commission (NTRC) has told all bookmakers licensed by the state to “cease and desist” from offering bitcoin betting in Australia.
DISCLOSURE IN ENGLISH LITIGATION: A SEA CHANGE IS COMING
On 9th January Lewis Silkin published a briefing which begins by saying that the rules on disclosure (‘discovery’ in many jurisdictions) in civil cases under English law are set for a major overhaul. Draft rules were published in November 2017. Once approved by the Civil Procedure Rules Committee, the resulting draft is intended to be introduced as part of a pilot scheme lasting 2 years, potentially beginning in April 2018 and running in the Business and Property Courts. This will cover virtually all High Court litigation. It will not be optional. Under the revised rules, an express duty of co-operation will be imposed on the parties and their lawyers and disclosure will be divided into 2 stages – basic and extended, and parties are expected to co-operate on potential extended disclosure. When serving a statement of case, a party will be required to indicate whether or not it is likely to seek “extended disclosure” on one or more issues.
www.lewissilkin.com/Insights/Disclosure-in-English-litigation-a-sea-change-is-coming
AUSTRALIA PRAISED FOR ENFORCEMENT OF FOREIGN BRIBERY OFFENCES
On 5th February King & Wood Malleson published an article saying that a recent evaluation of Australia’s detection and enforcement of foreign bribery offences has praised recent regulatory developments but highlighted areas for further improvement. A “Phase 4” evaluation was undertaken in 2017 by an OECD Working Group which reviews implementation of the OECD Convention on Combating Bribery of Foreign Public Officials. The Convention establishes legally binding standards to criminalise bribery of foreign public officials in international business transactions. The report was published in December.
ANTI-CORRUPTION AND BRIBERY PENALTIES IN NORWAY
On 10th January, law firm Alvheim & Hansen published an article providing a summary of the situation in Norway.
https://www.lexology.com/navigator#!results/577/view
HOUSE OF LORDS REJECTS PUBLIC BENEFICIAL OWNERSHIP REGISTERS FOR BRITISH OVERSEAS TERRITORIES
On 2nd February, Wilmer Cutler Pickering Hale & Dole published an article saying that on 17th January, the House of Lords voted against an amendment to the proposed Sanctions and Anti-Money Laundering Bill that sought to create a publicly accessible register of the beneficial ownership of companies registered in 6 British Overseas Territories – Anguilla, Bermuda, BVI, Cayman Islands, Montserrat and Turks and Caicos Islands – by 1st January 2020. The article considers whether the vote represents a faltering step in the UK’s commitment to combating the use of anonymous offshore shell companies in facilitating international corruption and money laundering.
https://www.wilmerhale.com/blog/wireuk/post/?id=17179886891
FAA PROPOSES RECORD $1.1 MILLION FINE FOR SHIPMENT OF LITHIUM BATTERIES
On 2nd January, a blog post from Jenner & Block LLP reports that the US Federal Aviation Administration recently levied a $1.1 million civil penalty for alleged violations of Department of Transport shipping regulations. According to the FAA, on June 1st 2016, a Florida-based battery distribution company despatched 4 shipments of 24-volt lithium batteries but one of the batteries is alleged to have caught fire while being transported on a FedEx truck after having been shipped on an aircraft, destroying the truck. The article remarks that the transportation of lithium batteries in aircraft is the subject of ongoing evaluation and scrutiny by the FAA.
ISLE OF MAN UPDATES LIBYAN AND SOUTH SUDAN SANCTIONS LISTS
On 6th February, the Isle of Man published 2 news releases advising of updates to its sanctions programmes – the updating of details of the Lynn S for the purposes of Libyan sanctions; and the listing of 3 names for the purposes of the South Sudan sanctions regime.
https://www.gov.im/news/2018/feb/06/financial-sanctions-libya/
https://www.gov.im/news/2018/feb/06/financial-sanctions-south-sudan/
MONEY LAUNDERING SUPERVISION: FEES
On 6th February, HMRC published a news release dealing with fees you need to pay when you register for AML supervision, and how to pay them.
https://www.gov.uk/guidance/money-laundering-regulations-registration-fees
EU PROMISES TO RESPECT WESTERN SAHARA TRADE RULING
On 6th February, the EU Observer reported that the EU will respect an ECJ ruling about trade with the disputed area of Western Sahara – a disputed territory annexed by Morocco in the late 1970s. A shaky ceasefire between the Polisario independence movement and Morocco was signed in 1991. The ECJ ruled in December 2016 that any trade pacts between the EU and Morocco are not applicable to Western Sahara.
https://euobserver.com/foreign/140852
EU FLAGS FRAUD AND CORRUPTION IN REFUGEE SETTLEMENTS IN UGANDA
On 6th February, EurActiv reports that a delegation had identified allegations of malfeasance and corruption in managing refugee assistance programmes in Uganda, and had alerted the country’s government, and had identified the “troubling allegations” together with its partner agencies and had formally submitted the case to the EU’s anti-fraud office OLAF. The article says that Ugandan authorities also said they were investigating allegations of widespread fraud in its refugee aid programme, as the UN also raised concerns over human trafficking in Ugandan camps. The article also reports that specific allegations are that South Sudanese girls and women are being trafficked from the refugee camps of northern Uganda back across the border, where they are sold as “wives” to combatants with the possible knowledge or complicity of Ugandan officials, the diplomat said.
LEADING IVORY TRADE INVESTIGATOR FOUND DEAD IN NAIROBI
Defence Web on 6th February reported that a prominent US investigator of the illegal ivory and rhino horn trade was found dead in his Nairobi home with a stab wound in his neck. Esmond Bradley-Martin, 75, spent decades tracking the movement of animal products, mostly from Africa to markets in Asia.
RENEGADE DR CONGO COLONEL EXTRADITED TO FACE TRIAL
Defence Web on 6th February reported that a renegade Congolese colonel who threatened to depose President Joseph Kabila was extradited from Tanzania and will be prosecuted for rebellion. John Tshibangu was based in the east of Democratic Republic of Congo (DRC). He was detained by authorities in Tanzania towards the end of last month.
SELECT COMMITTEE CLEARS EU DIRECTIVE ON FIFTH MONEY LAUNDERING DIRECTIVE
The House of Commons European Select Committee has cleared from scrutiny a proposal for a Directive amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and amending Directive 2009/101/EC. This would makes substantial changes to the scope and operation of anti-money laundering rules in the UK. The Committee’s report details the contents of the proposed Directive and the likely effects on UK legislation and processes.
https://publications.parliament.uk/pa/cm201719/cmselect/cmeuleg/301-xii/30118.htm#_idTextAnchor027
US AND ARGENTINA AGREE TO WORK TOGETHER TO TACKLE HEZBOLLAH FUNDING
On 6th February, JTA reported that the US Secretary of State (on a tour of Latin America) and his Argentine counterpart have agreed to work together to cut off Hezbollah funding networks and money laundering to finance terrorism across Latin America, a measure said to be well received by Jewish groups in Argentina. It notes that a report on Iranian activities in the region was presented to local leaders in 2013.
TESCO FRAUD TRIAL ABANDONED PENDING POSSIBLE RE-TRIAL
On 6th February the BBC reported that the trial of 3 former Tesco executives charged with fraud and false accounting has been abandoned. Chris Bush, Tesco’s former UK boss, John Scouler, Tesco’s former commercial food director and Carl Rogberg, its former UK finance boss have been on trial for more than 4 months.
http://www.bbc.co.uk/news/business-42943382?src=ilaw
IS THE ART MARKET A PLAYGROUND FOR MONEY LAUNDERERS?
In the UK, the AAT (accounting technician’s body) has published an article on risks presented by the art market, though it says that FATF says it is impossible to produce a definitive estimate of the amount of money globally laundered every year, because the illegal nature of transactions involved means precise statistics are unavailable. The article comprises a 30-minute podcast.
https://www.aatcomment.org.uk/is-the-art-market-a-playground-for-money-launderers/?src=ilaw
GREEK OFFICIALS HIT BACK AT NOVARTIS BRIBERY ALLEGATIONS
On 6th February the Greek Reporter reported that 2 former Greek prime ministers, former ministers and bankers have responded to the inclusion of their names in the Novartis bribery case tabled in parliament. The Swiss pharmaceuticals company is being investigated by Greek authorities over allegations of bribery towards public officials in the 2006-2015 period.
http://www.balkaneu.com/the-novartis-case-file-the-government-nd-and-the-investigation/?src=ilaw
DAGESTAN GOVERNMENT IN RUSSIA DISSOLVED AMID MAJOR CORRUPTION INVESTIGATION
Russian news service, RT, reported on 6th February that the acting head of the southern Russian republic of Dagestan has ordered the dismissal of the whole regional cabinet, after its former chairman and his deputies were held on charges of embezzling millions of roubles of state funds. The changes are said to have come after the Russian Federal Security Service (FSB) detained the former acting head of the Dagestani government, Abdusamad Gamidov, 2 of his former deputies – Shamil Isayev and Rajuddin Yusufov – and the former Dagestani education minister.
https://www.rt.com/politics/417983-dagestan-government-dissolved-as-former/?src=ilaw
RAIDS TAKE PLACE IN UK AS OPERATION LAUNCHED TO TACKLE PEOPLE SMUGGLING NETWORK
The Belfast Telegraph on 6th February reported that some 350 officers took part in raids in the Northumbria, Cleveland, Sussex and Metropolitan Police force areas. It says that they targeted around 20 addresses and visited car washes to monitor activity following a year-long investigation with links to the French, Belgian and Dutch authorities, and the operation included officers from Immigration Enforcement, HMRC and the Gangmasters and Labour Abuse Authority were carrying out spot inspections of the car washes. The authorities’ car wash inquiries were aimed at disrupting the gang’s money laundering operation.
http://www.nationalcrimeagency.gov.uk/news/1285-nca-strike-against-suspected-people-smugglers
CHINA SAYS TO BAN EXPORT OF MORE DUAL-USE GOODS TO NORTH KOREA
Customs Today on 6th February reported that China has released a further list of goods banned for export to North Korea, saying the items could be used to build WMD. It comments that China has released several such lists in recent years as North Korea steps up its nuclear and missile tests. The latest list names dozens of banned items including air scrubbers for underwater use, equipment to simulate flying conditions for non-civilian aircraft and gas masks not for use by firefighters.
http://www.customstoday.com.pk/china-says-to-ban-export-of-more-dual-use-goods-to-north-korea/
JUDGE OVERTURNS NOT-GUILTY SENTENCE FOR 2 MALTA FOOTBALLERS ACCUSED OF MATCH FIXING
Malta Today reported that on the acquittal on match fixing charges of 2 former Under 21 Maltese national football team players has been overturned on appeal. The pair were given a life ban issued by UEFA’s Control, Ethics and Disciplinary Board, had originally been cleared of association for the purpose of committing a crime and of bribery of players by a court in Malta.
EXPLOSIVE GROWTH IN ONLINE SHOPPING FRAUD, HUNDREDS OF CASES INVESTIGATED IN NETHERLANDS
On 6th February, Dutch News reported that police took action against suspect online retailers 438 times last year, compared with just 35 times in 2016. It says that in some cases, conmen had made replicas of the websites used by reputable shops in an effort to steal cash, the paper said. In others, they bought up existing domain names which they then use to set up in business for a short period. In total, police received over 38,300 reports of online shopping fraud last year although in 5,500 cases the complaint was withdrawn after the ordered goods arrived late. The average loss reported was about €200.
STATE OF EMERGENCY DECLARED IN MALDIVES AS OPPOSITION LEADER AND JUDGES ARRESTED
On 6th February the Irish Independent reported charges against opposition leader Maumoon Abdul Gayoom included bribery and attempting to overthrow the government. He was president from 1978 to 2008, when Maldives became a multi-party democracy, and is the half-brother of the current president, under whose rule the archipelago is said to have lost many of its democratic gains.
US TRUSTED TRADER PROGRAM (TTP) COULD BE OPERATIONAL THIS YEAR
Sandler Travis Rosenberg on 6th February reported that US Customs and Border Protection is continuing to evaluate key aspects of its TTP pilot launched in 2014 as it prepares to make the programme operational later this year. TTP would update and replace the Customs Trade Partnership Against Terrorism (C-TPAT) initiative launched in 2001 to ensure the security and safety of imported goods, into a broader AEO-type programme, such as that operated by the EU and several countries worldwide. It would unify the Importer Self-Assessment (ISA) system, which focuses on traditional customs compliance with C-TPAT controls. It would create an opportunity to enhance existing and future mutual recognition arrangements with foreign trading partners, who have or acquire similar AEO arrangements.
SINGAPORE SAYS NO STRONG CASE TO BAN CRYPTOCURRENCY TRADING
Customs Today on 6th February reported that Singapore’s central bank has been studying the potential risks posed by cryptocurrencies, but has resolved that there is as yet no strong case to ban trading of the digital coins in the city-state.
http://www.customstoday.com.pk/singapore-says-no-strong-case-to-ban-cryptocurrency-trading/
US BAN ON ARMS EXPORTS TO SOUTH SUDAN
On 6th February, Sandler Travis Rosenberg reported that w.e.f. 2nd February the US State Department has adopted a policy of denial of export licences or other approvals for defence articles and defence services subject to the International Traffic in Arms Regulations and destined for South Sudan – subject to limited exceptions.
INTERPOL AND UN CHIEFS ADDRESS GLOBAL SECURITY ISSUES
On 5TH February, a news release from Interpol said that, with an increased risk of foreign fighters returning home or joining other conflicts following the liberation of Da’esh-held territories transforming the global threat landscape, international security was high on the agenda during discussions between the heads of the UN and INTERPOL. They addressed areas of common concern where the 2 organisations can further streamline and strengthen their co-operation for the benefit of their member countries. Areas for enhanced collaboration have been identified in a number of UN Resolutions, including protecting critical infrastructure, preventing foreign terrorist fighter travel as well as combating all forms of transnational crime such as maritime piracy, human trafficking and drug smuggling. In addition, it is noted that there are currently nearly 600 valid INTERPOL-UN Special Notices for entities and individuals who are the targets of UN Security Council Sanctions Committees.
https://www.interpol.int/News-and-media/News/2018/N2018-001
NATIONAL COURTS MAY, IN CASES OF FRAUD, DISREGARD SOCIAL SECURITY CERTIFICATES ISSUED TO WORKERS POSTED WITHIN THE EU
A CJEU news release on 6th February reports that, during the course of an investigation into the employment of staff of a Belgian company active in the construction sector, the Belgian Social Security Inspectorate found that the company employed practically no staff and subcontracted the work at all its sites to Bulgarian undertakings which posted workers to Belgium. These had E 101 or A 1 certificates issued by the competent Bulgarian institution confirming that they were registered with the Bulgarian social security system. However, these were apparently counterfeit or wrongly issued and the Belgian authorities contacted the Bulgarian ones which provided a summary of the certificates issued, but did not take into account the facts established by the Belgian authorities. The case proceeded in the Belgian courts, and the European court has now ruled that, whilst mutual co-operation arrangements between Member States must be followed (at least at first and within accepted time limits) if the institution which issued the certificate fails to carry out a review within a reasonable period of time, it must be possible for the evidence of fraud to be relied on in judicial proceedings, in order to satisfy the court of the host Member State that the certificates should be disregarded. In the case in question (Case C-359/16 Ömer Altun and Others), the Belgian court was right to disregard the Bulgarian certificates.
https://curia.europa.eu/jcms/upload/docs/application/pdf/2018-02/cp180010en.pdf
IRELAND LOOKS TO STRENGTHEN DATA PROTECTION REGIME TO SUPPLEMENT THE GDPR
Out-Law reports on 6th February that new data protection offences are to be introduced in Ireland under broader plans to update the way in which personal data is protected in the country.
WHAT IS THE MAFIA?
On 6th February, on the back of reports of more arrests in Italy, the BBC provides an interesting feature asking who or what is the mafia? The Cosa Nostra, originating in Sicily, which dates back to the 19th Century. The Camorra from Naples – the subject of the bestselling book, Gomorrah. The ‘Ndrangheta from Calabria, the name derived from the Greek “andragathia”, meaning courage or loyalty. The Sacra Corona Unita, the smallest of the groups, from Puglia but believed to have important links to Eastern European crime gangs.
INTERNATIONAL CRIMINAL COURT JUDGES CONSIDER WHETHER TO LAUNCH AFGHANISTAN WAR CRIMES INQUIRY
The BBC on 2nd February reported that judges at the International Criminal Court (ICC) are deciding whether to authorise an official war crimes inquiry into events in Afghanistan. It says that they are due to begin examining written submissions from victims in Afghanistan about whom and what any potential investigation should focus on. In 2017, ICC prosecutor Fatou Bensouda said there was a “reasonable basis to believe” war crimes had been committed. The article says that possible perpetrators included the Taliban, CIA and Afghan forces.
http://world.einnews.com/article/430339229/zkYSEexqPqdW9qof?lcf=ZX9dkeSQfK-5FADPuwjBkQ%3D%3D
MARITIME RISKS IN 2017: A REVIEW
On 6th February, Control Risks published its review of maritime risk stories from 2017 and relevant statistics. It summarises that it sees global maritime security incidents continue to decline, but new threats are emerging. Amongst the headlines are –
- 5% decrease in global maritime security incidents
- 25% of piracy incidents took place in the Gulf of Guinea
- 83% decrease in kidnap incidents in South-East Asia
- Spike in Somali piracy and a new threat off Yemen
- 2-fold increase in incidents off Venezuela
https://www.controlrisks.com/our-thinking/insights/reports/maritime-risk-2017-in-review
UK: OFFSHORE TAX ABUSE CRACKDOWN BRINGS IN ONLY A THIRD OF EXPECTED £1 BILLION
The Risk & Compliance Hub on 5th February repeated a Guardian report claiming that a crackdown on offshore tax cheats has only recovered about a third of the £1 billion that the government had predicted, according to estimates. Figures from HMRC suggest that a series of measures to tackle offshore tax evasion will only bring in £349 million a year – £650 million a year less than had been hoped for.
MOBILISATION TO VIOLENCE (TERRORISM) RESEARCH – KEY FINDINGS
On 6th February, Andrea Berger on her Twitter account pointed one to Canada’s intelligence agency having released some key findings from their study of 100 individuals who radicalised to violence. Just to cheer one up, one of the report’s conclusions is that: “Terrorists rarely lack imagination in coming up with new ideas for achieving their ends, which means that indicators that are important today may not be important tomorrow”, and “There is no simple, definitive response to issues related to radicalization to violence and mobilization to terrorism”.
https://csis.gc.ca/pblctns/thrpblctns/2018-02-05-en.php
WHY DO ENTITIES GET INVOLVED IN PROLIFERATION? EXPLORING THE CRIMINOLOGY OF ILLICIT WMD-RELATED TRADE
On 1st February, this paper was published which seeks to provide an original approach to WMD-related illicit trade by drawing on criminology and focusing on the transactional level. Specifically, the article discusses the “rational-choice” model as a way to understand an entity’s involvement in illicit trade, and considers also the limitations of this approach, as well as the role that opportunity plays in an actor’s decision to engage in illicit trade. Worryingly (but not unexpectedly – see Dr Brewer’s recent piece on proliferation financing that makes the same point), the article draws the conclusion that the prospects of deterring illicit trade using export controls and related criminal sanctions are limited; and that the prospects of deterring illicit WMD trade are limited by the low levels of certainty in export-control enforcement (i.e. it won’t get checked and/or you won’t get caught). Another conclusion is that non-proliferation successes are more likely to be found in further efforts to develop tools to address proliferation opportunities. If you have $157 to spare (or $42.50 for 24 hours’ access), well worth getting, I think.
http://www.tandfonline.com/doi/full/10.1080/10736700.2018.1423718
See also his article in July 2017 for Defence in Depth –
WHAT DRIVES THE MIDDLEMEN? EXPLORING INVOLVEMENT IN WMD-RELATED ILLICIT TRADE
THE FUTURE OF SYRIA FROM AN ISRAELI PERSPECTIVE
INSS at Tel Aviv University has produced an article which says that during the civil war in Syria, the functioning of the country’s state system was fundamentally undermined, and essential questions have been raised regarding the shaping of a future state order in its territory and the implications of the trends evolving in this arena for Israeli national security. It warns that, though “Syria” under Assad has, or appears to have, survived the internal Syrian system is likely to be left with “hybrid” features, since years of war and the crystallization of different competing forces in this divided country will make it difficult for the central government to achieve broad legitimacy and institutionalize effective governance throughout all its territory; and it is to be expected that different forces in Syria — some in sectarian and ethnic enclaves (Alawite – Assad’s clan, Sunni, Kurdish), and others in chaotic regions with an active Jihadist presence — will continue to take form and operate. One important factor is the accelerated establishment of Shiite militias and Iranian dominance on the ground. It also warns that Israel will, from time to time, need to use military force to prevent the transfer of weapons to Hezbollah and the military solidification of Iran and its proxies in the Syrian-Lebanese region.
www.inss.org.il/publication/syria-state-hybrid-system-implications-israel/?offset=1&posts=99
US INTERNATIONAL BANKING TRADE BODY SUPPORTS REVISION OF AML LAWS
BAFT is the US association for organiSations actively engaged in international transaction banking. On 31st January it announced that it signed a joint trades letter that supports the Counter Terrorism and Illicit Finance Act (AML/CFT reform) proposed by US Representatives Pearce and Luetkemeyer. The Bill seeks to address the issue of beneficial ownership, and reduce the reporting inefficiencies under FinCEN rules.
CHINA’S NEW SINGLE WINDOW PLATFORM
On 5th January, Ince & Co produced a briefing on China’s New Single Window Platform. One of a number of major announcements of changes to Chinese customs procedures, is the national roll out of a “standard” Single Window system. This article looks at the changes this brings to the old system and the implications for traders.
POTTERS BAR, UKRAINE’S STOLEN BILLIONS AND THE EUROVISION CONECTION
KYC 360 on 6th February reported that a UK company helped the circle of Ukraine’s disgraced ex-president profit from last year’s Eurovision Song Contest, according to a BBC investigation. A Kiev exhibition centre paid to host some Eurovision events is owned through a Hertfordshire-registered company. At least £1.2 billion is said to have been funnelled through companies registered at the same Potters Bar address.
https://kyc360.com/news/potters-bar-ukraines-stolen-billions-eurovision-connection/
INDIA TO BAR CRYPTOCURRENCIES FROM PAYMENTS SYSTEM
KYC360 reported on 6th February that India is planning steps to ensure cryptocurrencies are illegal within its payments system, while at the same time appointing a regulator to oversee unregulated exchanges that trade in “crypto assets,” a finance ministry official is quoted as saying.
https://kyc360.com/news/india-bar-cryptocurrencies-payments-system-government-official/
US AND RUSSIA CLASH AT UN OVER SYRIAN CHEMICAL WEAPONS USE
Rferl on 6th February reported that Russia and the US have clashed at the UN Security Council over allegations the Syrian government has again used chemical weapons in rebel-held areas of the country. The exchange mirrored similar accusations and denials between the two sides in November when Russia vetoed a proposal to temporarily keep alive a UN investigation into who is responsible for chemical weapons attacks in Syria after blocking a one-year extension of the inquiry.
https://www.rferl.org/a/usa-russia-un-syria-chemicals/29021508.html
CPTPP TRADE DEAL SIGNED
On 2nd February, Clayton Lutz reports that on 23rd January, senior government officials from 11 countries – Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam – reached agreement on the final Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in Tokyo. The deal has been tweaked to take into account Canadian concerns that prevented it signing in November. From an Australian perspective, even with the absence of the US, the articles says that this is a landmark moment for enhancing economic growth for Australia, as the CPTPP will vastly improve market access for Australian businesses to a regional free trade area representing 13.5% of the global economy.
http://www.mondaq.com/article.asp?articleid=669942&email_access=on&chk=1630766&q=960824
THE POSSIBILITY OF HAVING DIFFERENT NAMES FOR THE SAME SHIP IN A BAREBOAT-OUT REGISTRATION
Law firm Ganado on 1st February published an article on a useful feature of Maltese shipping law that is often overlooked by operators of Maltese ships. Bareboat charter registration (dual registration) has been a common feature of the shipping industry as it has developed in the last 10 years or so. Dual registration takes place for various commercial and operational reasons. It comments that owners, operators, charterers and managers have various options when considering trading a vessel under dual registration; with one such option relates to naming their ship. (as I know from experience, those with no contact with the maritime industry get worried or confused over such arrangements).
http://www.mondaq.com/article.asp?articleid=669664&email_access=on&chk=1630488&q=960824
WHY DO ENTITIES GET INVOLVED IN PROLIFERATION? EXPLORING THE CRIMINOLOGY OF ILLICIT WMD-RELATED TRADE
On 1st February, this paper was published which seeks to provide an original approach to WMD-related illicit trade by drawing on criminology and focusing on the transactional level. Specifically, the article discusses the “rational-choice” model as a way to understand an entity’s involvement in illicit trade, and considers also the limitations of this approach, as well as the role that opportunity plays in an actor’s decision to engage in illicit trade. Worryingly (but not unexpectedly – see Dr Brewer’s recent piece on proliferation financing that makes the same point), the article draws the conclusion that the prospects of deterring illicit trade using export controls and related criminal sanctions are limited; and that the prospects of deterring illicit WMD trade are limited by the low levels of certainty in export-control enforcement (i.e. it won’t get checked and/or you won’t get caught). Another conclusion is that non-proliferation successes are more likely to be found in further efforts to develop tools to address proliferation opportunities. If you have $157 to spare (or $42.50 for 24 hours’ access), well worth getting, I think.
http://www.tandfonline.com/doi/full/10.1080/10736700.2018.1423718
MARITIME RISKS IN 2017: A REVIEW
On 6th February, Control Risks published its review of maritime risk stories from 2017 and relevant statistics. It summarises that it sees global maritime security incidents continue to decline, but new threats are emerging. Amongst the headlines are –
- 5% decrease in global maritime security incidents
- 25% of piracy incidents took place in the Gulf of Guinea
- 83% decrease in kidnap incidents in South-East Asia
- Spike in Somali piracy and a new threat off Yemen
- 2-fold increase in incidents off Venezuela
https://www.controlrisks.com/our-thinking/insights/reports/maritime-risk-2017-in-review
ISLE OF MAN UPDATES LIBYAN AND SOUTH SUDAN SANCTIONS LISTS
On 6th February, the Isle of Man published 2 news releases advising of updates to its sanctions programmes – the updating of details of the Lynn S for the purposes of Libyan sanctions; and the listing of 3 names for the purposes of the South Sudan sanctions regime.
https://www.gov.im/news/2018/feb/06/financial-sanctions-libya/
https://www.gov.im/news/2018/feb/06/financial-sanctions-south-sudan/
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