ISLE OF MAN: SANCTIONS REPORTS TO BE MADE TO FIU

On 3rd April, the Isle of Man FSA advised that, w.e.f. that date, reports which are required to be made in respect of financial sanctions must be made to the FIU.  Previously such reports were made to Customs and Excise.  This follows the coming into operation of the Customs and Excise Act 2017 which made the necessary amendment to legislation to allow the change to take place.  The change is in line with the Government policy of the FIU becoming a “one stop shop” for the reporting of all forma of financial crime.  The advice continues by saying that many businesses on the Island in the regulated sector will already be familiar with the FIU’s online reporting system –  THEMIS.  Those registered to use THEMIS should make their reports via this online system, using the “Sanctions” option in the Legislation under which disclosure is made drop down menu.  However, any general enquiries or applications for licences or authorisations in respect of financial sanctions should continue to be made to Customs and Excise.

https://www.iomfsa.im/fsa-news/2018/apr/reports-in-respect-of-financial-sanctions/

https://www.gov.im/news/2018/apr/03/financial-sanctions-reports-to-be-made-to-the-financial-intelligence-unit/

EXPORTING SENSITIVE GOODS TO IRAN: ASSESSING THE JCPOA PROCUREMENT CHANNEL

On 29th March, the International Institute for Strategic Studies published a paper saying that under the 2015 nuclear deal with Iran, a new mechanism was set up to regulate any procurement made by Tehran for its now limited nuclear programme.  The research paper takes an in-depth look at the Procurement Channel, as it is known, examining its workings and effectiveness so far, and offers recommendations to policymakers to ensure its sustainability.  The mechanism covers 3 categories of goods, and associated assistance and services –

  • goods that are ‘especially designed or prepared for nuclear use’;
  • dual-use goods with both nuclear and civilian applications – controlling this category of goods is generally more difficult because it comprises items which, in addition to their more sensitive use, also have wide industrial and commercial applications and which have comprised the bulk of Iran’s procurement activities; and
  • any other items that are determined by the ‘relevant State’ as having the potential to ‘contribute to activities inconsistent with the JCPOA’ – this is akin to the catch-all provision in many national export-control regimes, the goal being to capture the less straightforward cases. These items typically have lower technical specifications than what would normally be used in a nuclear programme.  Iran’s procurers have often focused on this type of goods once export-control enforcement has made purchasing others much more difficult.

To export any of the items in question to Iran, a company needs to go through the established licensing process in its home country whilst also submitting documents required by the Procurement Channel.

https://www.iiss.org/en/iiss%20voices/blogsections/iiss-voices-2018-2623/march-b1b3/assessing-the-jcpoa-procurement-channel-3424

BANNING UK SALES OF IVORY, INCLUDING IMPORTS AND EXPORTS

On 3rd April, DEFRA in the UK published a summary of responses to a consultation seeking views on banning UK sales of ivory and evidence on the effect this measure would have.  Consultation ended on 29th December.  Having considered the evidence available, including responses to this consultation, the government confirms it will proceed with a ban on commercial activities concerning ivory in the UK that could directly or indirectly fuel the poaching of elephants.  Commercial activities means buying, selling or hiring ivory; offering or arranging to buy, sell or hire ivory; keeping ivory for sale or hire; exporting ivory from the UK for sale or hire; importing ivory into the UK for sale or hire.  The policy document details the limited exemptions that would be allowed.

https://www.gov.uk/government/consultations/banning-uk-sales-of-ivory

https://www.gov.uk/government/news/government-confirms-uk-ban-on-ivory-sales

HOW THE GLOBAL DIAMOND TRADE SHAPED NEW YORK’S SKYLINE

On 1st April, the Real Deal, a news site for the New York real estate sector, carried an article which claims that developers who began in the diamond trade have built, acquired or have an interest in over 200 properties and projects now worth at least $20 billion, and that entities tied to Manhattan’s Diamond District own at least 259 properties in New York City though contributions tend to be buried behind a maze of LLC, front men and limited partnerships.  The article says that, in most cases, the investments are legitimate but that sometimes, they aren’t.  Gemstones are a popular tool to launder money, experts said, and real estate often provides the final rinse.  The article says that the news site set out to trace how this opaque, underreported symbiosis between diamonds and real estate came about — and how it shaped the skyline.  A long and fascinating piece, with allegations concerning not only money laundering but bribery, corruption and handling of “conflict” or “blood” diamonds.

https://therealdeal.com/issues_articles/rough-cut/

OFAC TARGETS MML – TERRORIST GROUP LASHKAR-E TAYYIBA’S POLITICAL PARTY

On 2nd April, OFAC, in concert with the US Department of State, has targeted Lashkar-e Tayyiba (LeT) and its political party, the Milli Muslim League (MML), by designating MML and 7 MML officials as Specially Designated Global Terrorists (SDGT).  OFAC designated 7 members of the MML central leadership body –  Saifullah Khalid, Muzammil Iqbal Hashimi, Muhammad Harris Dar, Tabish Qayyum, Fayyaz Ahmad, Faisal Nadeem, and Muhammad Ehsan – for acting for on behalf of LeT, a Pakistan-based terrorist group designated in December 2001.  All property and interests in property of these persons subject to US jurisdiction are blocked, and US persons are generally prohibited from engaging in transactions with them.

https://home.treasury.gov/news/press-releases/sm0335

THINGS YOU MAY HAVE MISSED – APRIL 2

2nd April 2018

MALTA: NGO SECTOR ‘VULNERABLE TO MONEY LAUNDERING’, NON-REGISTERED NGO ARE FUNDRAISING WITH “IMPUNITY”

The Times of Malta on 1st April reports that Malta’s voluntary sector continues to face “needless” vulnerability to money laundering and terrorist financing, according to the Commissioner for Voluntary Organisations in his annual report.  He said he had been unable to persuade the government of the urgency to introduce amendments to the Voluntary Organisations Act, which would give the Commissioner more powers to police the sector – the enrolment of voluntary organisations remained optional, with no means to ascertain how many non-enrolled organisations were currently active, fundraising with “impunity” and operating under the radar with zero accountability.

https://www.timesofmalta.com/articles/view/20180401/local/ngo-sector-vulnerable-to-money-laundering.674991

EX-GUATEMALAN DICTATOR RIOS MONTT DIES

Reuters on 1st April and other media reported that former Guatemalan military dictator Efrain Rios Montt had died at the age of 91.  At the time of his death he was again on trial for genocide for his role during one of the bloodiest phases of the Cold War-era conflict that lasted from 1960 until 1996, with Rios Montt ruling 1982-83.  In March 1982, he headed a junta that removed President Angel Guevara from power.

https://www.reuters.com/article/us-guatemala-riosmontt/ex-guatemalan-dictator-rios-montt-dies-leaving-bitter-legacy-idUSKCN1H81FB

DUBLIN PROBE OVER ‘RUSSIAN DIRTY MONEY’ HOMES

The Irish Independent on 1st April reported that a UK anti-corruption outfit that campaigns about suspicious Russian investment in the London property market has turned its attention to a cluster of high-end properties in leafy Dublin 4.  The Committee for Legislation Against Moneylaundering in Properties by Kleptocrats (Clamp K) has assigned a team of researchers to investigate the ownership of an unusually high number of vacant properties, examining whether the ownership follows a pattern that it claims is used by kleptocrats from Russia and other countries who funnel “dirty money” through chains of off-shore shelf companies.

https://www.independent.ie/irish-news/dublin-probe-over-russian-dirty-money-as-ballsbridge-homes-lie-vacant-36762985.html

SCHEME IN UK OPENS TO HELP COMBAT VAT EVASION BY NON-EU ONLINE TRADERS

On 1st April, registration for the Fulfilment House Due Diligence Scheme is launched, and it is intended to ensure that fulfilment houses play their part in reducing abuse of VAT rules by online traders based outside the EU.  If you run a business in the UK, such as a warehouse, that stores goods imported from outside the EU that are owned by, or on behalf of, someone established outside the EU, you will need to apply to register for the scheme.

https://www.gov.uk/government/news/scheme-opens-to-help-combat-vat-evasion-by-non-eu-online-traders

PRIVATBANK OF UKRAINE SUES PWC FOR $3 BILLION, ALLEGING FRAUDULENT AUDIT

Kyiv Post on 2nd April reported that State-owned Ukrainian lender, PrivatBank, is suing auditor PWC for $3 billion, alleging that it failed to detect massive fraud at the bank when it was owned by billionaire oligarch, Igor Kolomoisky.  The bank filed the lawsuit in Cyprus on March 30th, a PrivatBank spokesman said.  National Bank of Ukraine officials have accused the bank’s former owners – Kolomoisky and Gennadiy Boholyubov – of embezzling billions from the bank through a series of insider lending schemes, in which the bank would loan out millions of dollars to shell firms with faulty collateral.

https://www.kyivpost.com/business/privatbank-sues-pwc-3-billion-alleging-fraudulent-audit.html?src=ilaw

LIBERIA: PRESIDENT WEAH GIVES JUSTICE MINISTER 2 WEEKS TO INVESTIGATE GLOBAL WITNESS REPORT

All Africa on 2nd April reported that President George Weah has instructed Justice Minister Musa Dean to investigate reports of alleged grave acts of corruption on the sale of Oil Block 13 to US petroleum company ExxonMobil.  London-based Global Witness released a report on March 29th, which claimed that Exxon’s 2013 purchase of Liberia’s Block 13 oil licence more likely than not enriched former government officials who may have illegally owned the block.  The National Oil Company of Liberia (NOCAL) also made unusual, large payments to senior government officials who authorized the 2013 deal, Global Witness said in a report entitled, “Catch Me If You Can.”

http://allafrica.com/stories/201804020060.html?src=ilaw&viewall=1

JORDAN TO CREATE ANTI-SMUGGLING DIVISION TO PROTECT ANTIQUITIES

Customs Today on 23rd March reported that the new unit will start operating once the administrative law comes into effect.  The department will work in co-operation with the security bodies and the Jordan Customs Department to control smuggling and trading of antiquities.  It will also be be responsible for organising archaeological excavations, documenting and registering antiquities, operating ticket offices at sites and museums, and implementing the state policies related to agreements and protocols, issuing licences for local and international scientific institutions and archaeological missions, which run excavations, surveys and archaeological studies in Jordan, and will supervise the establishment of archaeological institutes and museums.

http://www.customstoday.com.pk/jordan-to-create-anti-smuggling-division-to-protect-antiquities/

FRENCH COMPANY, BOLLORÉ LOGISTICS, TO INVEST €300 MILLION IN AFRICA IN 2018

Lloyds Loading List on 29th March reported that French freight company, Bolloré Transport & Logistics, is planning to invest €300 million in Africa this year.  Plans include construction of a second container terminal at the port of Abidjan in Ivory Coast, jointly financed with Maersk.  The newsite says that one of the niche markets developed by Bolloré in Africa is in logistics operations for “soft commodities”.  Last month, it inaugurated a new 10,000 sq m warehouse in Abidjan dedicated to cocoa exports, the Ivory Coast being the world’s leading producer of the commodity.

https://www.lloydsloadinglist.com/freight-directory/news/Bolloré-Logistics-to-invest-€300m-in-Africa-in-2018/71632.htm#.WsIaXkxFycw

US FINTECH START-UP CHARGED BY SEC WITH DEFRAUDING INVESTORS

Market Watch on 2nd April reported that Michael Liberty, the founder of fintech start-up Mozido Inc., has been charged by the SEC with a scheme to defraud investors.  The SEC alleges Liberty and others tricked “hundreds of investors” in his shell companies, then stole most of the more than $48 million that was raised.  As of February 2018, Mozido was valued at $2.4 billion, according to The Wall Street Journal’s list of billion dollar start-ups.

https://www.marketwatch.com/story/mozido-founder-michael-liberty-charged-by-sec-of-defrauding-investors-2018-04-02?siteid=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A%20marketwatch%2Fmarketpulse%20(MarketWatch.com%20-%20MarketPulse)&src=ilaw

http://www.mondovisione.com/media-and-resources/news/sec-charges-fintech-company-founder-with-scheme-to-defraud-investors-and-misappr/

THINGS YOU MAY HAVE MISSED – APRIL 1

1st April 2018

CASABLANCA STILL AN ELDORADO OF COUNTERFEITING AND PIRACY

The Arab Weekly on 1st April reported that counterfeiting and pirated products in Morocco are worth $1.27 billion, which represents more than 1% of the country’s GDP.  It says that the overwhelming majority of the fake items come from China but some are made locally.  It is said that the government is boosting enforcement capabilities to meet its international commitments in the fight against counterfeiting and piracy.

https://thearabweekly.com/casablanca-still-eldorado-counterfeiting-and-piracy

OIL SMUGGLING IN SYRIA ALMOST CUT OFF

Al-Manar in Lebanon reports on 31st March information originating with the Russian Foreign Ministry that illegal oil trade channels exploited by terrorists in Syria have been almost completely severed.

https://www.english.almanar.com.lb/475510

GUPTA FIGHT GOES TO DUBAI

On 1st April, News 24 reported that South African National Prosecuting Authority (NPA) has asked the UAE government to preserve an amount of R169 million that the Gupta family allegedly stole and transferred out of South Africa.

https://www.news24.com/SouthAfrica/News/gupta-fight-goes-to-dubai-20180331

EX-VENEZUELAN TREASURER CLOSE TO CHÁVEZ IS TARGET OF FLORIDA MONEY LAUNDERING PROBE

The Miami Herald on 31st March reported that federal authorities are building a massive money laundering case against a former high-ranking Venezuelan official close to late President Hugo Chávez, Alejandro Andrade, a former bodyguard to Chávez who rose to the rank of national treasurer between 2007 and 2010.  The probe also targets other former senior officials and financial figures who collaborated with them.  Andrade’s acquisitions in South Florida and other parts of the US do not show up in public records because the purchases were made through shell companies that allow him to keep his ownership hidden, sources said.

http://www.miamiherald.com/news/local/article207503694.html#storylink=cpy

TURKEY: REPORTS OF FRAUD IN SPENDING EU’S AID FOR REFUGEES

ANF News on 1st April carries a story saying that projects financed by the EU within the frame of the Refugee Pact are broke and the finances are misused by Turkey, German magazine Der Spiegel has reported.  It says that, as a part of the Refugee Pact, the EU has already transferred €3 billion to Turkey.  Another €3 billion will be made available for Turkey soon.

https://anfenglish.com/news/turkey-reports-of-fraud-in-spending-eu-s-aid-for-refugees-25854?src=ilaw

NO CYPRIOT ARREST WARRANT FOR EFIMOVA AND GIVES INTERVIEW FROM GREEK PRISON

The Malta Independent on 1st April reported that Greek newspaper Kathimerini says that there is no pending arrest warrant against Russian, Maria Efimova, the Pilatus Bank whistleblower, in Cyprus.  The Cypriot authorities are said to have attempted to lodge a Red Notice for the Russian, but Interpol’s general secretariat dismissed the request saying the evidence submitted had been insufficient.  Efimova handed herself in to Greek authorities on 20th March.

http://www.independent.com.mt/articles/2018-04-01/local-news/No-Cypriot-arrest-warrant-for-Efimova-gives-interview-from-Greek-prison-6736187242?src=ilaw

LIMERICK PENSIONER AND FORMER COMPANY DIRECTOR FACING JAIL OVER FALSE INVOICES

The Limerick Leader on 1st April reported that Mary Donnelly, 71, a former company director in Limerick who generated false invoices resulting in the fraudulent payment of more than €600,000 is to begin a 12-month prison sentence at the beginning of May.  The defendant was one of the directors of a family-owned business – Shannonside Audio/Video Limited – established in 1979 and liquidated in November 2013, which provided “audio/visual services” to clients across the country and had a “prestigious list of clients”.

https://www.limerickleader.ie/news/home/305361/limerick-pensioner-and-former-company-director-facingjail-overfalse-invoices.html

SINGAPORE LAUNCHES BLOCKCHAIN CHALLENGE WITH FUNDING PRIZES

Customs Today on 1st April reported that Singapore’s government is launching a challenge that will reward successful blockchain projects with funding. Its Infocomm Media Development Authority (IMDA) said the challenge aims to boost blockchain innovation as part of a wider goal of the digital transformation in the city state.  According to the fact sheet for the challenge, the bureau is specifically targeting 2 categories of blockchain applications: “enterprise” and “transformation”.

http://www.customstoday.com.pk/singapore-launches-blockchain-challenge-with-funding-prizes/

TAIWAN FINDS 2 TONS OF DRUGS HIDDEN INSIDE MACHINERY FROM CHINA

Customs Today on 1st April reported that customs authorities found 2 tons of raw materials enough to make ketamine for 5 million people hidden inside machinery imported from China.  The Ministry of Justice Investigation Bureau said it found 240 kg of ketamine and 1,884 kg of hydroxylimine hydrochloride, the raw material for the drug, hidden inside machines.

http://www.customstoday.com.pk/taiwan-catches-2-tons-of-drugs-hidden-inside-machinery-from-china/

THE TALIBAN HAS GONE HIGH-TECH

The New York Times reported on 1st April that, once described as an ill-equipped band of insurgents, the Taliban are increasingly attacking security forces across Afghanistan using night-vision goggles and lasers that US military officials said were either stolen from Afghan and international troops or bought on the black market.  The article claims that, with this new battlefield visibility, the Taliban more than doubled night time attacks from 2014 to 2017.

https://www.nytimes.com/2018/04/01/world/asia/taliban-night-vision.html