OTHER THINGS YOU MAY HAVE MISSED – JUNE 30

30th June 2018

REPORT: IRAN SEEKING ILLEGAL MISSILE TECHNOLOGY IN GERMANY

The Jerusalem Post on 29th June carried a report saying that North Rhine-Westphalia, announced that Iran sought to obtain illicit goods for its missile program from Germany in 2017.  A report from an agency there is quoted as saying, in connection with illegal Iranian and Pakistani efforts to obtain missile technology, “in the overwhelming majority of the number of cases, however, there occurred no delivery of the particular goods”.   It is said to be unclear from the report how many attempts Iran made to secure illegal technology nor the number of attempts that led to the transfer of proliferation merchandise and know-how to Iran’s regime.

https://www.jpost.com/Diaspora/REPORT-Iran-seeks-illegal-missile-technology-in-Germany-561202

PROBE CLEARS FINNISH COMPANY OVER EXPORT LICENCE FOR UAE

Defense News on 29th June reported that an investigation by Finland’s Chancellor of Justice has cleared the government of any impropriety or irregularities in the awarding of a military export licence to Patria to cover the sale of armoured personnel carriers to the UAE.  It is said that the export deal complied with all laws regulating the sale of weapons systems and military equipment to foreign states, and thus deliveries can go ahead.  The report is quoted as saying that the government made its decision knowing the UAE is involved in a civil war conflict in Yemen.  The Finnish state holds 50.5% of the shares in Patria, with the other 49.5% owned by Norway’s Kongsberg Defence and Aerospace.

https://www.defensenews.com/global/europe/2018/06/29/despite-yemen-conflict-probe-clears-finland-over-patria-export-license-for-sale-to-uae/

LONDON ART DEALER IS IN A HIGH COURT BATTLE WITH ARTS COUNCIL OVER THE EXPORT OF A GIOTTO PAINTING

The Antique Trade Gazette on 29th June reported that the 13th Century painting, Madonna and Child, was exported to the UK from Italy in 2007 following litigation in the Italian courts.  The London art dealer later applied to the Arts Council [which handles cultural export licensing on behalf of the Department for International Trade] for a licence to export the painting out of the EU, but this was refused in 2015.  The Arts Council maintains that it is unable to grant an export licence because the Italian authorities say the painting did not have the necessary licence to be exported from Italy in 2007 and are seeking to have it returned.  When originally purchased at an auction in 1990 it was thought to be a copy, but later work revealed it to be genuine, and hence to be worth around £10 million (and not the £3,500 paid for it).   The High Court has reserved judgment which will be handed down in due course.

https://www.antiquestradegazette.com/news/2018/art-dealer-in-court-over-export-of-giotto-painting-from-italy/

CHINESE UNIVERSITY LINKED TO CHINA’S ARMY CHARGED WITH CONSPIRING TO VIOLATE US EXPORT LAWS

Info Sur Hoy on 26th June reported that an indictment charged China-based Northwestern Polytechnical University (NWPU) along with Shuren Qin, a Chinese national living in Massachusetts.  The indictment also charged LinkOcean Technologies, a Chinese company headed by Qin, whose clients, according to prosecutors, include Chinese research institutes and the naval warfare branch of the People’s Liberation Army.  Qin, 41, was charged with conspiring to commit export violations in 2015/16, exporting 78 hydrophones, devices which can be used to monitor sound underwater, to NWPU, which the indictment described as a Chinese military research institute.  He is additionally charged with visa fraud.

http://infosurhoy.com/cocoon/saii/xhtml/en_GB/news/u-s-charges-chinese-university-tied-to-army-with/

MAN INVOLVED IN SMUGGLING GUNS AND AMMUNITION INTO THE UK JAILED

A news release from the CPS on 29th June reported the case of Andrew Billings, 31, who was involved in importing 2 sub-machine guns and a loaded Luger pistol, as well as ammunition and a silencer, conspiring with 2 other men to possess the guns with intent to endanger life.  Billings supplied the guns in the Netherlands and worked to find a prospective buyer for them once they were in the UK.  He liaised with 2 men to organise a trip to pick up the firearms.  They used strong magnets to stow the guns to the underside of a tourist coach returning from Europe and attached a tracker to follow the coach’s journey back to its depot in Coventry before Maynard and Barbary picked the firearms up in a van.  Following conviction, Billings was found to have made £50,000 from his crimes.  He was also ordered to repay a confiscation order of £11,495.  He was given 3 months to pay or would face 7 months in prison.  Barbary had a benefit figure of £49,444.58 but had a realisable amount of £100 and was given 3 months to pay.  Maynard was found to have made £10,000 but a realisable amount of £1.

https://www.cps.gov.uk/cps/news/man-involved-smuggling-guns-and-ammunition-uk-jailed

 EGYPT AND HISTORIC ARTEFACTS – IT HAS ALWAYS HAD A SMUGGLING PROBLEM

Arab News on 29th June carried an article that laments that government policies are overlooking the importance of ancient Egyptian antiquities to the development of our country has encouraged many to engage in the illicit trafficking of antiquities, a practice that has been increasing substantially, especially in the last few years.  It says that Egypt is sitting on a treasure trove of precious antiquities — and those that are housed in our museums seem to be only a fraction of what lies beneath the land, and the illegal excavation of antiquities is happening in many parts of the country, with a relatively high success rate.  The article refers to the recent discovery of 23,000 ancient Egyptian artefacts concealed in a diplomatic container in Italy.  The number of artefacts, along with the smuggling method, made it obvious that the illegal trafficking of antiquities is a well-organised and powerful business in Egypt.

http://www.arabnews.com/node/1330421

DANISH SMUGGLERS ARRESTED IN NORWAY WITH OVER 100 KG OF CANNABIS

The Local in Norway on 29th June reported that 2 Danes in their 50s and 60s have been arrested in a major narcotics case in Norway, with a large quantity of cannabis seized by police.  Both have previous convictions for drugs offences.  The older of the Danes, a man in his late 60s, was involved in a spectacular narcotics case in Denmark in the 1990s, when he was behind an operation to smuggle 6 tonnes of cannabis from Morocco to Denmark by boat.  The second man in the Norwegian arrest, who is in his 50s, also has previous convictions for smuggling cannabis, including a 7-year sentence from 2001 for smuggling 700 kg of cannabis from the Netherlands to Denmark.

https://www.thelocal.no/20180629/danish-smugglers-arrested-in-norway-with-over-100-kilograms-of-cannabis

AUSTRALIA: DRIVER CAUGHT SMUGGLING RECYCLABLE CONTAINERS ACROSS STATE BORDERS

The Daily Mail reported on 29th June on the case of a man who smuggled 45,000 empty drinks cans bought from a pub in New South Wales, worth $7,000 across the state border in South Australia, where a refund fee per can was payable.  His conviction was the first of his kind in 41 years in the state.

http://www.dailymail.co.uk/news/article-5900085/Broken-Hill-driver-caught-smuggling-recyclable-cans-state-borders.html

ATTORNEY GENERAL: TRINIDAD & TOBAGO FACING EU SANCTIONS

Trinidad & Tobago Newsday on 30th June carried an article saying that the Attorney General had warned that the European Parliament is applying sanctions as a result of a “mis-characterisation” of this country’s compliance status with the FATF standards.  He made this disclosure during debate on a motion to approve a joint select committee report on the Anti-Terrorism Amendment Bill 2018.  He warned that if the the bill did not continue its progress the country will not complete the timeline FATF set for it to report on September 5th.

http://newsday.co.tt/2018/06/29/ag-tt-facing-sanctions/

EX-BARCELONA BOSS SANDRO ROSELL TO FACE TRIAL FOR MONEY LAUNDERING

Sundiata and other sources on 29th June also reported that Rosell’s wife, an Andorran lawyer and 3 other people would also stand trial.  Rosell, who previously lived and worked in Brazil, is suspected of having siphoned €15 million in illegal commissions from a TV rights deal for the Brazil national team along with the former head of the Brazilian Football Confederation.

https://sundiatapost.com/2018/06/29/ex-barcelona-boss-sandro-to-face-trial-for-money-laundering/

STEINHOFF RESULTS – POUNDLAND OWNER PROBLEMS INCLUDE $5.5 MILLION LOSS ON ITS ISLE OF MAN-REGISTERED JET

Business Insider in South Africa on 30th June published an article on the interim results from the Steinhoff group for the half-year to March 2018.  It suffered an operating loss of €152 million and its revenue declined by 6% to €9.34 billion.  It has also written off billions of euros due to overstatements and other misreporting.  The company has been struggling to stay afloat after accounting irregularities emerged in December, which saw its CEO Markus Jooste resign.  The police is now investigated fraud at the company, which has lost 98% of its value in 7 months.  Amongst the points in the results that the article highlights is that Rainford Isle of Man Limited, a wholly owned subsidiary of Steinhoff, sold a company for $15.5 million in January, less than a year after acquiring it for $21 million.

https://www.businessinsider.co.za/steinhoff-took-a-r80-million-loss-selling-its-new-company-jet-and-4-other-things-you-should-know-from-its-new-interim-results-2018-6

A CRASH COURSE ON MICHAEL LOWRY

The Irish Times 30th June provided a summary asking such things as what was he convicted of this week, and why was he described as ‘conscientious taxpayer’?  What was the payment made to an Isle of Man entity called the Glebe Trust?

https://www.irishtimes.com/news/politics/give-me-a-crash-course-in-michael-lowry-1.3548384

OECD LAUNCHES LARGEST SOURCE OF COMPARABLE TAX REVENUE DATA

On 28th June, the OECD unveiled a new database providing detailed and comparable tax revenue information for 80 countries around the world – and which will expand to cover more than 90 countries by the end of 2018.  It was presented at the 5th plenary meeting of the Inclusive Framework on BEPS, held in Lima.  The Global Revenue Statistics Database integrates information from the four annual Revenue Statistics publications, which provide tailored insights on tax systems and revenue priorities in African, Asian, Latin American and Caribbean (LAC), and OECD countries.

http://www.oecd.org/tax/tax-policy/oecd-launches-largest-source-of-comparable-tax-revenue-data.htm

UN TARGET 2030: ILLICIT FINANCIAL FLOWS

The Spanish Royal Institute Elcano (a think-tank for international and strategic studies that analyses world events and trends from a Spanish, European and global perspective) on 28th June published a Paper that begins by saying that Target 16.4 in the UN Sustainable Development Goals (Agenda 2030) is a global commitment to reduce the level of illicit financial flows (IFF) and the damage they do.  The target stands as a great achievement by civil society organisations, bringing a complex set of issues from the wilderness to the international agenda.  But, it says, there remain critical challenges, both technical and political, if progress is to be realised.  The second section of the Paper addresses these challenges.  ‘Illicit financial flows’ is an umbrella term which covers cross-border movements related to tax avoidance, tax evasion, regulatory abuses, bribery and the theft of state assets, the laundering of the proceeds of crime and the financing of terrorism.  The Paper aims to provide a background to the SDG Target 16.4, and the origin of the term illicit financial flows.

ARI81-2018-fig-1

According to the Paper, the impacts of illicit financial flows are many and varied, but the common element is that IFF are corrosive to the state’s legitimacy and capacity to act, which in turn undermines the achievement of human rights and development.  Figure 1 above highlights just some of these effects, and two key categories can be identified.

http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/ARI81-2018-Cobham-Target-2030-illicit-financial-flows

IRAN LOOKING FOR WAYS TO EXPORT OIL DESPITE US SANCTIONS

The Times of Israel on 30th June claimed that Iran has set up a committee to seek potential buyers, as Trump calls on Saudi Arabia to boost production to offset lost Iranian exports and stem price hikes.  Among the issues discussed, it says, were “suggestions to achieve self-sufficiency… in producing petroleum, and to prevent the vulnerability in the field of energy carriers”.

https://www.timesofisrael.com/iran-looking-for-ways-to-export-oil-despite-us-sanctions/?src=ilaw

CYPRUS UNDER THE US COSH?  THE CRACKDOWN ON MONEY LAUNDERING

The Cyprus Mail on 30th June reported on the issue on June 14th by the Central Bank of Cyprus (CBC) of a circular letter to all credit institutions advising them to step up their game when it comes to due diligence on shell companies and letterbox outfits, part of a broader drive to crack down on money laundering.  It says that, although the CBC officially denies it, rumour has it that the guidance was prompted by US pressure. Is there any truth to that, the article asks?  The new rules are to be incorporated into an upcoming revision/update of the CBC’s AML directive.  The guidance was issued shortly after the visit to the island of the US Treasury Assistant Secretary for Terrorist Financing.

https://cyprus-mail.com/2018/06/30/under-the-us-cosh-the-crackdown-on-money-laundering/?src=ilaw

BILLIONAIRE ART DEALER GUY WILDENSTEIN CLEARED OF TAX FRAUD AFTER SECOND PARIS TRIAL COLLAPSES

Artlyst on 30th June reported that French billionaire art dealer Guy Wildenstein has been cleared of tax fraud after a second trial collapsed in Paris.  He was accused of not declaring art worth hundreds of millions of euros to the taxman.  French tax authorities claimed the family fortune remained obscured after the death of Guy’s father Daniel in 2001.

http://www.artlyst.com/news/guy-wildenstein-cleared-tax-fraud-second-paris-trial-collapses/

MAN CONS LEICESTERSHIRE CAR SHOWROOM OUT OF BMW THEN DRIVES IT TO ROMANIA

Leicestershire Live reported on 30th June that Grigore Codarcea, 33, a Romanian national, disappeared to Romania with a £17,000 BMW that he had failed to pay for.  He bought the vehicle from a car showroom, having put down £1,000 deposit and arranged finance on the balance.  But he only made 1 monthly payment of £290 before defaulting on the 5-year agreement, made in April 2016.  He was arrested on his return to the UK, at Luton airport, in August 2017.

https://www.leicestermercury.co.uk/news/local-news/man-cons-car-showroom-out-1707371

RECORD NUMBER OF FAKE HMRC WEBSITES DEACTIVATED

On 30th June, HMRC issued a news release saying that it had removed more than 20,000 malicious websites during the past year – increase of 29% on the previous year but warned people to stay alert to the threat from online fraudsters.  It said that it has brought in cutting edge technology to tackle cyber-crime and target fraudsters.

https://www.gov.uk/government/news/record-number-of-fake-hmrc-websites-deactivated

RUSSIA’S DUTY-FREE THRESHOLD ON IMPORTED ONLINE PURCHASES

Customs Today on 29th June reported that the Russian Finance Ministry has reportedly tweaked its proposed reforms to Russia’s duty-free threshold on imported goods bought online.  The new plan would reportedly lower the threshold to €500 a month per customer, w.e.f. July 1st. Starting on July 1st 2019, the policy would change from monthly import totals to individual package values, with the new threshold set at €100 per parcel, but not to exceed €200 in a single month.  Previously, you could buy up to €1,000 or as much as 31 kg in a month from foreign online stores without paying a special tax of 30% (not to exceed €4 per kg).

http://www.customstoday.com.pk/the-finance-ministry-tweaks-proposed-reforms-to-russias-duty-free-threshold-on-imported-online-purchases/

EU CUSTOMS UNION: THE WORLD’S LARGEST TRADING BLOCK TURNS 50

On 30th June, the EU published a factsheet celebrating the 50th birthday of the EU customs union marking 1st July 1968, when all customs duties and restrictions lifted between the then 6 member countries of the European Economic Community (EEC).  A timeline of developments 1968-2018 is provided.

http://europa.eu/rapid/press-release_MEMO-18-4288_en.htm

IMPERIAL INVESTS IN MEDICINAL CANNABIS

TJI on 29th June reported that Imperial Brands Ventures, a subsidiary of Imperial Brands (formerly Imperial Tobacco), has taken an undisclosed equity share in the medicinal cannabis research company, Oxford Cannabinoid Technologies (OCT).  OCT is a biopharmaceutical company that researches, develops and licenses cannabinoid-based therapies and compounds. OCT is licensed for operation by the UK Home Office.

http://www.tobaccojournal.com/Imperial_invests_in_medicinal_cannabis.54869.0.html

IS HEZBOLLAH SMUGGLING WEAPONS TO BRAZIL?

Customs Today on 29th June reported that Hezbollah is being investigated in Brazil for the illegal trade of firearms, according to the influential O Globo newspaper.  According to the report, federal investigators in Brazil have been probing possible ties between Lebanon and criminal gangs in Brazil for the past 8 years.  Hezbollah-linked groups allegedly began smuggling arms into Brazil back in 2006, according to federal documents obtained by O Globo, which suggest that Lebanon’s lucrative drug trade played a key role in funding the illegal trade.

http://www.customstoday.com.pk/is-hezbollah-smuggling-weapons-to-brazil/

US COURTS NOT BOUND BY FOREIGN GOVERNMENT’S STATEMENT OF ITS LAWS

Latham & Watkins LP published an article on 29th June about a US Supreme Court ruling that US federal courts should carefully consider a foreign government’s interpretation of its own domestic laws but are not required to give it conclusive effect.  The article says that this “respectful consideration” standard means foreign governments will likely face uncertainty as to how their domestic laws will be interpreted by US courts, that the Supreme Court has laid down 5 factors for consideration which will provide guidance on how foreign governments can best position and support their interpretations.  It also says that parties’ evidence in support of and against a foreign government’s submitted interpretation of its domestic laws may be given substantial weight in determining the proper interpretation under US law.  Fuller details are provided in the Client Alert from the firm.

https://www.jdsupra.com/legalnews/scotus-us-courts-not-bound-by-foreign-53367/

FATF TYPOLOGIES REPORTS

As discussed at the FATF Plenary last week, these typology reports were approved on 29th June –

http://www.fatf-gafi.org/publications/fatfgeneral/documents/outcomes-plenary-june-2018.html

APOLOGIES – they have not, as yet, been published by FATF, but are expected shortly, having been now formally approved…watch this space!

OTHER THINGS YOU MAY HAVE MISSED – JUNE 29

IRAN REOPENS URANIUM FEEDSTOCK PLANT IN PREPARATION TO BOOST ENRICHMENT

Reuters on 28th June reported that Iran has reopened a nuclear plant idle for 9 years, according to its atomic energy agency (AEOI).  This could be used to increase uranium enrichment capacity if a nuclear deal with world powers falls apart after the US withdrawal from the JCPOA.  The AEOI said that a plant for the production of UF6, the feedstock for centrifuge machines that enrich uranium, had been relaunched and a barrel of yellow cake has been delivered.

29th June 2018

ILLEGAL CIGARETTES IN AND FROM LIBYA

Ozy.com on 29th June reported that Libya has emerged as Africa’s leading importer of rolled tobacco, according to the World Bank. From 2014 to 2016, those imports totalled $485 million, 50% more than second-place Morocco.  However, ordinary Libyans aren’t smoking more – it is estimated that 93% is used to make contraband cigarettes.  Instead, it says, most of Libya’s cigarette market is illegal, with fakes produced and smuggled by militias to keep their campaigns — and the war — alive.  In 2016, the highest number of illegal cigarettes in the Maghreb region were consumed in Libya — 6.44 billion, or 93% of all cigarettes smoked in the country, according to KPMG. Tunisia was next, with 4.64 billion.  Libyan groups smuggling contraband cigarettes aren’t just targeting the domestic market, but also Tunisia and Niger.

https://www.ozy.com/acumen/why-libyas-future-is-a-haze-of-cigarette-smoke/87184

SMUGGLED, UNDER-INVOICED TILES FROM IRAN HURTING PAKISTAN’S LOCAL INDUSTRY

The Pakistan Observer on 29th June reported that around 1.2 to 1.3 million square meter tiles per month are being smuggled from Iran whereas a mere 10,000 square meter tiles per month are being officially being imported from Iran on lower tariff valuation, damaging the local industry.

https://pakobserver.net/smuggled-under-invoiced-tiles-from-iran-hurting-local-industry/

SUSPECTED PEOPLE SMUGGLERS ARRESTED AFTER SCAM TO ENTER BRITAIN ILLEGALLY VIA IRELAND

The Irish Times on 28th June reported that 7 suspected members of an international people trafficking gang, all from Georgia, said to be using Ireland as a route into the UK have been arrested after a joint operation between the Garda, police in England and the PSNI.  They are accused of facilitating other Georgians in travelling to the Republic and then on to Britain illegally.  Garda fear not only an increase in the routing after Brexit, but that it could lead to an increase in the number of people claiming asylum in Ireland then vanishing from the system – in 2017, more than 300 Georgians claimed asylum here, more than any other nationality except Syria.  Before 2017, the numbers from Georgia were negligible.

https://www.irishtimes.com/news/crime-and-law/suspected-people-smugglers-arrested-after-scam-to-enter-britain-illegally-via-ireland-1.3547532

MALTA: 3 JAILED AND FINED NEARLY €500,000 EACH ON CIGARETTE SMUGGLING CHARGES

The Malta Independent and others on 28th June reported that 3 men involved in a cigarette smuggling racket have been jailed and fined nearly half a million euros each, 2 other men were acquitted due to lack of evidence.  Police had been alerted by an informant that a consignment of cigarettes was to arrive in Maltese by a fishing boat under cover of darkness in July 2013.  The court also ordered the confiscation of the vessel as well as the contraband cargo seized by the authorities.

http://www.independent.com.mt/articles/2018-06-28/local-news/Three-jailed-fined-nearly-0-5m-each-on-cigarette-smuggling-charges-6736192609

HOBBY LOBBY’S ILLEGAL ANTIQUITIES SHED LIGHT ON A LOST, LOOTED ANCIENT CITY IN IRAQ

KCBX in the US carried on its website on 28th June an article about the case involving Oklahoma-based arts and craft chain, Hobby Lobby, and the illegal import of antiquities – shipped from the UAE and Israel without declaring their true Iraqi origin.  Hobby Lobby agreed to forefeit the items and pay a $3 million fine and, in May, about 3,800 objects were handed back to the Iraqi embassy and will be returned to Iraq later this year.  Looting intensified in the security vacuum after the 2003 invasion of Iraq and, apart from the loss of the artefacts themselves, crucial information placing them in the context of where they came from is also lost when undocumented objects are removed from their original sites.  Looting is sure to remain a problem, experts say, as most of Iraq’s archaeological sites are unprotected and other large markets remain outside the US.  Archaeologists believe many private collectors of looted Mesopotamian antiquities are wealthy Gulf Arabs.

http://kcbx.org/post/hobby-lobbys-illegal-antiquities-shed-light-lost-looted-ancient-city-iraq#stream/0

2 ARRESTED AT AMBULANCE SCOTLAND FIRM AMID ALLEGATIONS OF MONEY LAUNDERING AND TAX OFFENCES

The Daily Record on 29th June reported that HMRC had raided the headquarters of Ambulance Scotland – which won a lucrative contract covering the country’s biggest indoor arena, the SSE Hydro, last year – and arrested 2 members of staff.  HMRC confirmed arrests had been made following an operation carried out with the assistance of Police Scotland.  Ambulance Scotland provides private emergency vehicles and medical staff for major events and also provided private ambulances for the NHS.

https://www.dailyrecord.co.uk/news/scottish-news/scots-ambulance-firm-facing-allegations-12816847

ASTROLOGY IRELAND PSYCHIC CHARGED WITH FRAUD AND MONEY-LAUNDERING OFFENCES

The Irish Independent on 28th June reported that Simon Gold, 53, a psychic turned financier charged with fraud and money-laundering offences has been further remanded in custody.  He is best known for his firm Astrology Ireland and has billed himself as “Ireland’s Leading 7th Generation Psychic Astrologer & Tarot Master”.  He was charged with money laundering by allegedly possessing €800,000 in proceeds of criminal conduct at a bank in Dublin in 2012.  In addition to the money laundering allegation he was also charged with deception.

https://www.independent.ie/irish-news/courts/wellknown-astrology-ireland-psychic-charged-with-fraud-and-moneylaundering-offenses-37060298.html

REAL ESTATE INVESTIGATION IS NEXT FOR AUTHOR OF CASINO MONEY LAUNDERING REPORT

The Star in Vancouver on 28th June reported that the Attorney general of British Columbia is to follow up his report on money laundering through casinos in the province with a second report on its real estate sector.  A 2016 Transparency International Canada study found that 45% of the most valuable residential properties in Greater Vancouver are held through corporate structures.

https://www.thestar.com/vancouver/2018/06/28/real-estate-investigation-is-next-for-author-of-bc-casino-money-laundering-report.html

CAVEATS – THE SCOTTISH EARLY WARNING SYSTEM FOR CERTAIN COURT ORDERS AGAINST YOU OR YOUR BUSINESS

On 28th June, Brodies asked in a briefing: “Did you know it was possible in Scotland to receive advance notice of someone trying to raise certain court orders against you or your business, in the form of a caveat?”.  In Scotland, caveats can be lodged at the Court of Session and at any of the Sheriff Courts (broadly equivalent to County Courts in England) on behalf of companies, individuals, firms, partnerships and trusts.  They last for 1 year and can be renewed every year for as long as required.  The court must give a party’s solicitor advance notice (although this may only be 24 hours or so) before any application for an interim court order against that party can be heard, so that the party has the chance to attend the hearing and oppose the order – except in the case of appointments of administrators or receivers.

http://www.brodies.com/blog/corporate/caveats-the-scottish-early-warning-system/

PRIVATE PROSECUTION

On 27th June, Edmonds Marshall McMahon published 2 articles on the subject of private prosecutions.  Firstly, on the duty of candour when applying for a summons and the information does a private prosecutor have to put forward to get a proper summons issued.

https://www.emmlegal.com/news/private-prosecution-the-duty-of-candour-when-applying-for-a-summons/

The second article provides what is described as the investigator’s view and the need for a high standard of evidence.  What, it asks, is an “investigation” in the context of a private prosecution?

https://www.emmlegal.com/news/private-prosecutions-the-investigators-view/

FCA FINES CANARA BANK FOR SERIOUS AML FAILINGS RELATING TO TRADE FINANCE ACTIVITIES IN THE UK

DAC Beachcroft on 28th June published an article detailing the background to the FCA Final Notice explaining the grounds upon which it fined Indian bank, Canara, £896,100 (reduced from £1,280,175 (30% reduction due to early settlement) and imposed a restriction on it accepting deposits from new customers for 147 days as a result of long term serious AML failings.  It seems that in 2012 there was no evidence that risk assessments or sanctions checks had been carried out for trade finance customers and that there was limited evidence that trade-based money laundering risks were being considered or documented.  However, in 2015 the FCA again found that there was no evidence that AML risks were being taken into account and managed at any level within Canara, with a lack of action on the findings from the 2012/2013 visits despite assurances given.  Therefore, the FCA appointed a skilled person to report on Canara’s AML and sanctions systems and controls.  There is no suggestion that Canara’s AML failings led to any instances of money laundering being allowed to take place in the UK.

https://sites-dacb.vuturevx.com/106/5659/landing-pages/fca-fines-canara-bank-for-serious-aml-failings-relating-to-its-trade-finance-activities-in-the-uk.asp?sid=1cb0aa96-4855-4d23-bc35-d6c2115a710a

MALAYSIA’S 1MDB TASK FORCE FREEZES BANK ACCOUNTS OF FORMER PM NAJIB RAZAK’S PARTY

Business Times on 29th June reported that a taskforce investigating a multibillion dollar scandal at state fund 1Malaysia Development Berhad (1MDB) said that it had frozen bank accounts belonging to the political party of former prime minister Najib Razak.  The United Malays National Organisation (Umno) is believed to have received funds from 1MDB.

https://www.businesstimes.com.sg/government-economy/malaysias-1mdb-taskforce-freezes-bank-accounts-of-former-pm-najib-razaks-party?src=ilaw

FORMER ICE CHIEF COUNSEL SENTENCED TO 4 YEARS IN PRISON

The Daily Caller in the US on 28th June reported that the former Immigration and Customs Enforcement chief counsel, Raphael Sanchez, was sentenced to 4 years in prison for charges related to wire fraud and an identity theft scheme, according to the DoJ.  He obtained private information, forged Social Security cards and driver’s licenses, which were later used to open credit card and bank accounts under the names of the aliens.

http://dailycaller.com/2018/06/28/ice-immigrant-identities/?src=ilaw

https://www.justice.gov/opa/pr/former-ice-chief-counsel-sentenced-four-years-prison-wire-fraud-and-aggravated-identity-theft

UK: THE IVORY BILL

On 28th June, the House of Commons Library published an updated briefing paper on the Ivory Bill.  It is the Government proposal to ban the commercial use of elephant ivory, with some exceptions.  The paper also includes background information on the ivory trade, its impact on wild elephant populations and international efforts to address this.  The Bill has its Report Stage in the House of Commons on 4th July.

https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-7875

CONSULTATION ON UK SOCIETY LOTTERY REFORM

On 29th June, the UK launched a consultation to 7th September on changes to Society lotteries, which play a vital role by enabling charities and other societies, such as sports clubs, to run lotteries for good causes.  The amount a society can raise is currently subject to limits of £4 million sales per draw, £10 million sales per year and a maximum prize of £400,000.  The government’s preferred options would allow a tenfold increase in the amount that a large society lottery can raise per year, bringing the annual limit to £100 million.  The per draw sales limit would rise to £5 million and the maximum prize to £500,000.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/720930/society_lotteries_consultation_june_2018_pdf.pdf

EDINBURGH ‘CURRY KING’ IN HOT WATER OVER £229,000 TAX BILL

Edinburgh Evening News on 29th June reported that Scotland’s “curry king” Tommy Miah has been barred from being a company director for 7 years after running up a tax debt of £229,000. He and his wife Anwara, failed to keep accounts for the company behind award-winning eatery The Raj in Blackhall.  The Evening News says that it understands Miah, 59, now faces being stripped of his MBE and the threat of criminal proceedings and a fine or even prison.
https://www.edinburghnews.scotsman.com/news/edinburgh-curry-king-in-hot-water-over-229-000-tax-bill-1-4761623

TURKISH POLICE BUST IRAQ CAR-SMUGGLING GANG

Customs Today on 29th June reported that 5 suspected members of an organised crime ring that was smuggling stolen cars into Iraq have reportedly been arrested in Turkey.  Police detained 3 members of the gang, one of them a Greek national, at a customs office in Istanbul after they cleared a luxury Jaguar through customs.  They later detained a Turkish national and the Iraqi leader of the group in a raid on a villa.  According to Hurriyet, the leader of the is understood to be a prominent figure in Iraq’s automobile market, owning many auto galleries in the country.

http://www.customstoday.com.pk/turkish-police-bust-iraq-car-smuggling-gang/

AUSTRALIA WINS TOBACCO PLAIN PACKAGING CASE AT WTO

On 29th June, TJI reported that a panel of judges at the WTO has rejected arguments brought by Cuba, Indonesia, Honduras and the Dominican Republic, ruling in favour of Australia in the landmark trade dispute over plain packaging for tobacco.  The ruling rejected arguments made by the 4 countries that plain packaging unjustifiably infringed on trademarks and violated intellectual property rights.

http://www.tobaccojournal.com/Australia_wins_plain_packaging_case.54866.0.html

HONG KONG CUSTOMS SEIZES 29 TONNES OF ENDANGERED WOOD IN SHIPPING CONTAINER FROM HONDURAS

Yahoo News on 28th June carried a South China Morning Post report saying that the haul of suspected Guatemalan rosewood was the 5th major wood-smuggling case detected by customs officers in the city this year, bringing the total seizure of high-value wood in 2018 to 114 tonnes.  That represents a 170% increase compared with the 42 tonnes seized in the whole of last year.  In Hong Kong, importing or exporting an endangered species without a licence carries a maximum penalty of 10 years in jail and a HK$10 million fine.

https://sg.news.yahoo.com/customs-seizes-29-tonnes-endangered-064651887.html?guccounter=1

NON-PROLIFERATION TREATY TUTORIAL

NTI offers a free, interactive tutorial online on the Treaty on the Non-Proliferation of Nuclear Weapons (also known as the Non-Proliferation Treaty or NPT) is the cornerstone of the international nuclear non-proliferation regime.

http://tutorials.nti.org/npt-tutorial/introduction/

ISLE OF MAN: CONSULTATION RESPONSE ON CORPORATE GOVERNANCE CODE OF PRACTICE FOR INSURERS

On 28th June, the Financial Services Authority provided details of the consultation feedback received in relation to its proposals to enhance the existing Code, which was issued in October 2017.  It says that a number of detailed and informative responses were received from interested parties and the FSA responses include details of changes that have been made following the consultation exercise and indicate where the FSA will engage further with the non-life insurance industry in relation to certain aspects of the draft updated Code.

https://www.iomfsa.im/fsa-news/2018/jun/consultation-response-corporate-governance-code-of-practice-for-insurers-cgc/

EU LEADERS ENDORSE NEW SANCTIONS REGIME TARGETING CHEMICAL WEAPONS

Rferl on 29th June reported that the leaders endorsed a statement calling for “adoption as soon as possible of a new EU regime of restrictive measures to address the use and proliferation of chemical weapons”.  The move comes 3 months after a chemical-weapons attack on Sergei Skripal and his daughter Yulia Skripal in Salisbury.

https://www.rferl.org/a/eu-leaders-endorse-new-sanctions-regime-targeting-chemical-weapons-disinformation-campaigns/29326911.html

WHAT WE KNOW – AND DON’T KNOW – ABOUT RELIGIOUS CIVIL WARS

ETH Zurich has published on 29th June an article which says that ongoing civil wars in Syria, Mali, Afghanistan, the Philippines, Thailand, and Uganda illustrate the need to better understand religious dimensions of armed conflicts.  New data on religion and conflict worldwide – during the time period 1975-2015 – helps inform understanding of the religious dimensions of armed conflicts.  Drawing on the data and findings, the article sheds light on 3 widely held beliefs concerning religious conflicts – armed conflicts between actors from different religious identities are becoming more common; Islamist armed conflicts are increasing; and religious claims cannot be negotiated

https://isnblog.ethz.ch/conflict/what-we-know-and-dont-know-about-religious-civil-wars

INTERNATIONAL MEETING IN BRUSSELS TO END TRADE IN TORTURE INSTRUMENTS

On 29th June, the EU reported on a meeting of the countries involved in the UN Alliance for Torture-free Trade to share expert information and exchange best practices related to the control of the trade in goods used for torture and capital punishment.  Nearly 60 states are now members of the Alliance.  The Alliance aims to make it harder to trade in goods used for torture and capital punishment, to co-ordinate rules between countries and to exchange best practices.  The participating countries have committed themselves to several goals, including controlling and restricting exports of items used for torture such as batons with metal spikes, electric shock belts, grabbers that seize people while electrocuting them, chemicals used to execute people and the forced injection systems that go with them.  They also committed to set up a platform for customs authorities to monitor trade flows and identify new products on the market, to put appropriate legislation in place and to exchange practices for its efficient enforcement.

http://europa.eu/rapid/press-release_MEX-18-4325_en.htm

CHINESE-OWNED BORDEAUX VINEYARDS SEIZED IN FRAUD INQUIRY

RFI on 29th June reported that 10 Chinese-owned Bordeaux wine châteaux – which are not big-name Bordeaux producers – have been seized as part of an investigation into alleged fraud relating to their purchase, police in the region confirmed.  The initial inquiry started 4 years ago was into 24 châteaux, all of which had been purchased for €55 million by the Haichang group, which has holdings in marine transport, real estate, amusement parks and other sectors, with allegedly operations between offshore companies and French ones that have no connection with each other, as well as a loan of €30 million from the Paris branch of China’s ICBC bank using fake deeds.

http://en.rfi.fr/20180629-chinese-owned-bordeaux-vineyards-seized-fraud-inquiry/?src=ilaw

PNB FRAUD: HONG KONG BANKING REGULATOR CRACKS DOWN ON INDIAN LENDERS

First Post on 29th June reported that the banking regulator in the Special Administrative Region (SAR) has initiated a clean-up operation by subjecting banks to rigorous reviews, including on-site examinations and a review of their credit risk management processes.  This followed concerns raised by the newspaper about links to, and operations in, Hong Kong connected to the PNB Bank fraud in India.

https://www.firstpost.com/business/pnb-fraud-hong-kong-banking-regulator-cracks-down-on-indian-lenders-operating-in-the-sar-over-suspected-irregularities-4629871.html

DID SUSPECTS WANTED BY INTERPOL RECEIVE BULGARIAN PASSPORTS?

Novinite in Bulgaria on 29th June claimed that senior state officials and at least 1 minister and 1 deputy prime minister are allegedly involved in a corruption scheme for acquiring Bulgarian citizenship.  More than 114 people wanted by Interpol received Bulgarian passports and lawyers prepared the application documents for amounts between €500 and €3000.  The website cited French newspaper, “Nouvel Observatory”, and claims that had been repeated in the parliament.

https://www.novinite.com/articles/190837/114+Wanted+by+Interpol+Received+Bulgarian+Passports%3F?src=ilaw

ABACHA LOOT: NIGERIAN GOVT NOT HANDLING REPATRIATED FUNDS TRANSPARENTLY

The Daily Post in Nigeria on 29th June reported that the Swiss ambassador has decried what it termed lack of transparency in the Nigerian Government’s handling of repatriated $1 billion funds looted by late Head of State, Sani Abacha.  He made the statement at a forum on Asset Recovery hosted by the embassy to discuss issues surrounding the late Abacha’s recovered assets.

http://dailypost.ng/2018/06/29/abacha-loot-nigerian-govt-not-handling-repatriated-funds-transparently-swiss-envoy/?src=ilaw

DANISH HEAD OF A PHARMACEUTICAL COMPANY PLEADS GUILTY TO IMPORTING COMMERCIAL QUANTITIES OF ILLEGAL ANABOLIC STEROIDS

An NCA news release on 29th June reported that Jacob Sporon-Fielder, 37, a Danish national who had been living in India, has admitted conspiracy charges relating to Class C substances worth more than £80 million.  He was arrested after arriving at Heathrow Airport in March 2015 on suspicion of being knowingly concerned in the fraudulent importation of a prohibited drug, namely Class C steroids.  3 other men appeared alongside him and they all pleaded not guilty.  They will stand trial in February and April 2019.  2 others have been charged.

http://www.nationalcrimeagency.gov.uk/news/1403-danish-national-pleads-guilty-to-steroid-smuggling-charges

HACKERS STEAL $31 MILLION IN CRYPTOCURRENCY FROM BITHUMB IN KOREA
On 29th June, Robinson & Cole Data Privacy and Security Insider published a report that Bithumb, the 7th largest cryptocurrency exchange and located in South Korea, has confirmed that it was hacked and lost approximately $32 million in coins.

https://www.dataprivacyandsecurityinsider.com/2018/06/hackers-steal-31-million-in-cryptocurrency-from-bithumb/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+DataPrivacyAndSecurityInsider+%28Data+Privacy+%2B+Security+Insider%29

RARE BIRD EGGS IMPORTATION PREVENTED BY BORDER FORCE AT HEATHROW

A Border Force news release on 29th June reported that officers seized 19 eggs containing rare and endangered bird species, 2 of which had already hatched.  A man who had arrived on a flight from South Africa was questioned and searched, 19 bird eggs were found concealed within a body belt, as well as 2 newly-hatched vultures.  Border Force specialist officers identified that the eggs were protected under the Convention on International Trade in Endangered Species (CITES).  A 56-year-old Irish national was arrested.

https://www.gov.uk/government/news/rare-bird-eggs-importation-prevented-by-border-force-at-heathrow

AUSTRALIAN PARLIAMENT APPROVES LOTTERY BETTING BAN

i-Gaming Business on 29th June reported that Australia’s parliament has given its formal approval for a national ban on lottery betting websites.  The ban will come into force from January 1st and applies to all websites that accept bets on the outcome of lottery draws.  The federal government was persuaded to take action following a long-term campaign by newsagents, pubs and clubs that feared losing lottery ticket sales.

http://www.igamingbusiness.com/news/australian-parliament-approves-lottery-betting-ban

GUILTY PLEA IN HONDURAN SOCIAL SECURITY SCANDAL – IN THE US

Baker McKenzie on 29th June reported that a figure in a social security scandal in Honduras has pleaded guilty to money laundering charges in New Orleans.  Carlos Zelaya, 47, pleaded guilty in the laundering of more than $1.3 million in bribe payments.  His brother, brother, Mario Zelaya, was the director of the Honduran Institute of Social Security, from 2010 to 2014.

http://www.riskandcompliancehub.com/a-louisiana-guilty-plea-in-honduran-social-security-scandal/

CONSULTANCY COMPANY TOPS HMRC TAX DEFAULTER LIST OWING £10.6 MILLION

Accountancy Daily on 29th June reported that HMRC’s latest list of major tax defaulters is topped by a consultancy contracting company owing £10.6 million on £12.5 million unpaid tax, followed closely by a retail mail order house owing £5.2 million, with a raft of restaurants and takeaways, as well as an accountant, also in the list.

https://www.accountancydaily.co/consultancy-company-tops-tax-defaulter-list-owing-ps106m

USCG DETAINS VESSEL WITH 80 TONS OF SALMON FOR SUSPECTED ILLEGAL FISHING IN NORTH PACIFIC

Homeland Security Today reported on 23rd June that the US Coast Guard detained the fishing vessel Run Da suspected of illegal, unreported, unregulated (IUU) fishing activity in international waters 860 miles east of Hokkaido, Japan.  The fishing vessel is suspected of violating the worldwide driftnet moratorium called for by the UN General Assembly Resolution 46/215.  The USCG transferred custody of the Run Da and its crew to the PRC Coast Guard, which will escort the Run Da back to China for prosecution.  China has jurisdiction for any enforcement actions taken upon the vessel, master and owner.  The US and China have an MoU for co-operation at sea to enforce the controls.

https://content.govdelivery.com/accounts/USDHSCG/bulletins/1f94a1a

UK RATIFIES GLOBAL TREATY TO TACKLE ILLEGAL TOBACCO TRADE

On 29th June, HMRC announced that the UK has ratified an international agreement aimed at significantly reducing the illicit tobacco market, both in the UK and worldwide.  The UK is the 40th country to ratify the agreement, thus bringing it into international law.  The World Health Organization’s (WHO) Framework Convention on Tobacco Control (FCTC) Protocol to Eliminate Illicit Trade in Tobacco Products provides a blueprint for the regulation of tobacco production and distribution, as well as international co-operation between enforcement authorities.  The UK ratified the FCTC in 2004 and is one of 181 parties to have done so.  The Protocol is said to represent a significant move towards a new global standard in tobacco control, with international partners working together to tackle the problem.  Most of the requirements of the Protocol have been in place in the UK for some time as part of its tobacco anti-fraud strategy.  These include requirements for registration of tobacco factories and licensing for tobacco manufacturing machines, which was the final outstanding requirement in the UK and the government laid regulations before Parliament to achieve this in January 2018.

https://www.gov.uk/government/news/uk-ratifies-global-treaty-to-tackle-illegal-tobacco-trade

MICHAEL ADAMS: MEMBER OF NOTORIOUS CRIME FAMILY CHEATED HIS WAY AROUND £300,000 TAX

The London Evening Standard on 29th June reported that Michael Adams, 53, was sentenced to 38 months in prison after hiding hundreds of thousands of pounds, including more than £200,000 in cash which was stashed in a chest of drawers at his partner’s mother’s flat.  He hid the funds over 8-year period.  The Judge noted that Adams had no relevant previous convictions and that his last conviction was more than 30 years ago.

https://www.standard.co.uk/news/crime/michael-adams-jailed-member-of-wellknown-crime-family-cheated-his-way-around-300k-tax-a3875831.html

CRASH FOR CASH: 77 SENTENCED IN HUGE CAR INSURANCE SCAM, 158 CONVICTIONS SO FAR

The BBC on 29th June reported that a massive car insurance scam which netted £2 million for the ringleaders has seen more than 150 people convicted for submitting bogus claims.  At Newport Crown Court, the final 3 people were sentenced, so the scale of the fraud can now be revealed.  Fake crashes were concocted and bogus compensation claims submitted from 2009-2012 and the total number of people involved has now reached 158.  All those involved admitted or were convicted of conspiracy to defraud, in cases that began in 2011.

https://www.bbc.co.uk/news/uk-wales-south-east-wales-40901111

OFAC REMOVES 21 COLOMBIAN ENTRIES FROM ITS COUNTER-NARCOTICS SDN LIST

On 29th June, a news release advised the removal of a number of persons and entities from its SDN lists.  It also advises a number of changes to other entries.

https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20180629.aspx

NEW BRIEFING PAPER ON TRIPOLI’S ARMED GROUPS IN LIBYA

On 29th June, Small Arms Survey released a new SANA Briefing Paper which says that the history of Tripoli after the fall of Qaddafi is one of conflict, shifting control, fractured alliances, and the quest for power and influence.  Central among the players in this quest have been the militias controlling the capital’s territory.  A new Briefing Paper from the Security Assessment in North Africa project traces the genesis of the 4 militias involved and explores how they exercise their power now, and what dangers the Libyan capita l— and the country — face in the future.

http://www.smallarmssurvey.org/about-us/highlights/2018/highlight-sana-bp-tripoli.html

 

EXPORT CONTROLS AND COUNTER-PROLIFERATION FINANCE: 2 SIDES OF THE SAME UNDERLYING ILLEGAL WMD ACTIVITY

HIGHLY RECOMMENDED

A paper from the Non-Proliferation review on 28th June argues that the separation between export control and counter-proliferation finance (CPF) efforts may be undermining governments’ ability to detect and stop WMD proliferation; and that separating export controls from counter-proliferation finance efforts may be undermining both.  Using export-control information in screening financial transactions and using financial information in export-control decision making can be mutually reinforcing, each system feeding new information back to the other, creating a fuller picture of proliferation procurement networks.  One thing it says is that many in the international community tend to focus on international obligations, particularly targeted financial sanctions, despite the breadth of this definition.  This narrow reading of what constitutes “proliferation finance” is hindering governments’ abilities to identify and stop proliferation procurement networks. CPF is broader than simply refusing to do business with entities on UN sanctions lists or maintaining lists of export-controlled commodities (relatively easy tasks); it also requires identifying suspicious activities and financial transactions that support proliferation (a relatively difficult task).  Entities that are not sanctioned may be involved in illicit acquisitions, frequently involving dual-use goods.  It makes recommendations, including –

  • concrete ways to promote information sharing both domestically and internationally;
  • second a non-proliferation/export control expert to review SARs with the FIU;
  • conduct a systematic analysis of SAR to identify proliferation finance and export control links;
  • add a “Proliferation Finance” checkbox to SAR forms;
  • bring more insurance companies into AML/proliferation-finance efforts;
  • marine insurance companies offering cargo, hull, or liability insurance are at the forefront of international exports, making them potentially valuable players in the fight against proliferation;
  • improve goods- and activity-based automated screening tools and encourage financial institutions to use them;
  • increase collaboration between the FATF and the international export-control regimes;
  • continue improving FATF proliferation-finance typologies; and
  • export control and proliferation-finance information are mutually reinforcing; says, for example, export control authorities began systematically searching SAR information when evaluating the end users for export licenses, they could improve their understanding of end-user intent and therefore improve export-control decisions.

https://www.tandfonline.com/doi/full/10.1080/10736700.2018.1473107

UPDATED FATF LIST OF JURISDICTIONS WITH STRATEGIC AML/CFT DEFICIENCIES

The list, approved at the FATF Plenary 21st-29th June, comprises Ethiopia, Pakistan, Serbia, Sri Lanka, Trinidad & Tobago, Tunisia, and Yemen.  Vanuatu and Iraq have been removed from the list.  A news release issued on 29th June provides the reasons for listing/delisting.

http://www.fatf-gafi.org/publications/high-riskandnon-cooperativejurisdictions/documents/fatf-compliance-june-2018.html