15th June 2018
REPORT TO CONGRESS ON US SANCTIONS ON NORTH KOREA
On 14th June, the US Navy Institute News reported on a Congressional Research Service (CRS) report, ”North Korea: Legislative Basis for U.S. Economic Sanctions” of 11th June. The report details the effect of the sanctions on US-DPRK relations. It notes that restrictions on North Korea have been in place from as far back as 1950 – and the outbreak of the Korean War. It details the economic sanctions currently in place – relating to trade, aid, military supplies, access to assets and access to the US financial system – as well as those imposed by the UN. Of interest is Appendix B, which compares US and UN sanctions.
REPORT TO CONGRESS ON IRAN SANCTIONS
On 2nd March, USNI News had reported on a similar report by the CRS submitted to the US Congress on 21st February and, like the North Korea report, detailing US sanctions in place – before the announcement of withdrawal from JCPOA and the “snapback” of US sanctions. It also comments on international compliance and implementation and compares US and UN sanctions in place.
Copies of each report are found on the pages of the USNI articles.
LITHIUM SHORTAGE EXPECTED DUE TO LACK OF MINES
Engineering.com on 14th June carried an article about a feared lithium shortage and whether there is enough lithium to keep up with rising demand that has been mostly driven by the rapid growth of the electric vehicle market. It notes that most of the world’s supply of lithium is concentrated underground in three South American countries: the “lithium triangle” of Chile, Argentina and Bolivia, and that Chile alone has more lithium than any other country in the world – and Chile has historically kept strict control over its lithium output: current Chilean law prohibits lithium production above 80,000 tonnes but recently granted a production and export licence to a joint venture owned by Chilean and international lithium companies.
LEBANON CENTRAL BANK TO BANKS: KNOW YOUR REAL CLIENT
Business News in Lebanon on 15th June reported that the Central Bank (BDL) has issued a circular instructing banks and financial entities to identify the ultimate owners or controllers, technically called ’beneficial owners’, of their institutional and individual clients, and that they must also open a specific register that lists the names of the ultimate beneficial owners for each of their customers. When bank clients are legal entities, the natural persons who own 20% or more of these entities directly or indirectly are considered the beneficial owners and they must be identified by the banks – or apply other criteria other criteria such as majority voting rights, or the right to appoint or dismiss the entity’s administrative board. It is said that the circular also applies to financial institutions, issuers or marketers of all kinds of payment and loyalty cards, foreign exchange dealers, finance leasing companies, electronic money transfer companies, and specialized lending entities (comptoirs de crédit).
TOBACCO INDUSTRY “SEEKING TO CONTROL ANTI-SMUGGLING MEASURES”
The Guardian on 14th June reported on a research paper from Bath University that says that the tobacco industry is working to secure control of a system to track the movement of cigarettes around the world, allegedly because it is complicit in the smuggling of its own products. The research claims that the industry is now going to elaborate lengths to control the global “track and trace” system that the UN has said must be put in place to counter smuggling. Two-thirds of the illicit tobacco market is made up of genuine product, says the study.
THAI ENVOY PROBING ‘SMUGGLED STATUE’ IN LONDON UNIVERSITY
Thai Visa News on 14th June reported that Thailand’s ambassador to the UK has been instructed to contact the director of University of London’s School of Oriental and African Studies (SOAS) over claims the prestigious institution possesses a 13th Century sculpture likely smuggled from Thailand, the Foreign Ministry announced. SOAS has been accused of accepting the 1-metre-tall Buddha statue that stands at the entrance to its Brunei Gallery. It was gifted to the SOAS by American alumni Mary and Paul Slawson who reportedly bought it minus documents attesting to its provenance some 30 years ago.
MOZAMBIQUE MINERS LAUNCH CLAIM IN HIGH COURT FOR HUMAN RIGHTS ABUSES
Kingsley Napley in a April/May update newsletter reported that proceedings have been issued in the High Court against Gemfields Limited, a London-based mining company. It says that the claim relates to conduct of a subsidiary company in Mozambique and has been being brought by over 100 miners and members of the local community who allege responsibility for a series of human rights abuses.
ADDITIONAL DUTIES ON LARGE NUMBER OF US PRODUCTS IMPORTED INTO THE EU TO BEGIN APPLYING IN JULY THIS YEAR
HK TDC on 15th June published an article about the decision to impose additional duties on the full list of US products that was notified to the WTO. This measure is in response to US tariffs on steel and aluminium products. The application of what is being termed as the “rebalancing of duties” is, according to a Commission announcement, fully in line with WTO rules, and corresponds to a list of products previously notified to the WTO. The WTO Safeguards Agreement allows for a “rebalancing”, corresponding to the damage caused by the US measures. The US-origin products to bear the brunt of the rebalancing duties starting in July include sweetcorn, rice, orange juice, whiskey, tobacco, certain cosmetics, a variety of clothing items, steel products, certain household articles, motorcycles, sailboats and playing cards.
SOUTH AFRICA: FORMER CRIME INTELLIGENCE BOSS PAT MOKUSHANE ARRESTED
News 24 on 15th June reported that former crime intelligence boss Pat Mokushane has been arrested and is expected to appear in court on charges of corruption, fraud and money laundering. It says that Mokushane, Brigadier Leonora Bamuza-Phetlhe and another police officer in crime intelligence were arrested.
WEALTH PLANNER BOSS CHARGED WITH FRAUD ON MISSING £13 MILLION
Wealth Manager on 15th June reported that Freddy David, managing director of the collapsed London planner HBFS wealth planning firm which was wound up in March with more than £13 million in investor money missing, has been charged with fraud by City of London police. The firm had been closed down by the FCA in December.
US: CFTC SECURES ANOTHER DEFAULT ORDER IN BINARY OPTIONS, BITCOIN FRAUD CASE
On 15th June, Finance Feeds reported that the Commodity Futures Trading Commission (CFTC) has secured an entry of default against The Entrepreneurs Headquarters Limited, an entity allegedly responsible for a $1.1 million fraudulent scheme.
JAMAICA: 2 MEN CHARGED IN MONEY LAUNDERING PROBE
On 15th June, the Gleaner reported that an engineer at the government-owned company National Energy Solutions Limited (NESOL) is one of 2 persons facing corruption-related charges following a multiagency investigation that culminated with the seizure of more than $30 million in cash and 4 luxury vehicles. NESOL was established in 2015 to take over the functions of the Rural Electrification Programme.
NEW ZEALAND: GROUP FOUND GUILTY IN $54 MILLION MORTGAGE FRAUD CASE
On 15th June, Stuff reported that the lawyer, banker and wife of a convicted property developer who were on trial for their alleged involvement in a $54 million mortgage fraud have been found guilty. Earlier this year the man at the centre of the fraud case, Kang Huang, also known as Gang Wang, was sentenced prison after admitting providing false information to acquire fraudulent home loans, and to bribing one employee. construction company LV Park is said to be at the centre of the fraud. Unable to borrow from the major trading banks, LV Park made sham arm’s-length sales to obtain bank loans through the use of false documents. The fraudulent activity involved 75 properties and there are 3 banks involved in the case.
JERSEY SAYS NEW RESEARCH PAPER DEBUNKS MYTHS SURROUNDING IFC
On 15th June, Tax News reported that Jersey Finance has published a new discussion paper prepared by a leading UK think-tank, which argues that international financial centre (IFC) play a vital, positive role in the global economy. Undertaken by the Institute of Economic Affairs (IEA), with support from Jersey Finance, the paper is titled “The Benefits of Capital Mobility”.
CHINESE WASTE IMPORT RESTRICTIONS/IMPACTS ON US STATE AND LOCAL RECYCLING PROGRAMMES
On 14th June, Mitchell Williams published an article saying that the Solid Waste Association of North America (SWANA) issued what it describes as an “update” on the topic of China waste import restrictions. The update is intended to provide an overview of the effect that the Chinese restrictions are having on the export of recyclables from the US and Canada and the analysis includes what it describes as the increased movement of material to southeast Asian countries and additional potential restrictions.
SINGAPORE AND AUSTRALIA SIGN AN AEO-MUTUAL RECOGNITION ARRANGEMENT
In its 15th June E-Flash, FIATA reported that under the agreement signed on 31st May Singapore companies certified as having lower risks will enjoy faster customs clearance with reduced documentary and cargo inspections with respect to their goods exported to Australia. Likewise, Australian companies that are certified by Australian Border Force will enjoy similar facilitation for their goods exported to Singapore.
EU COMMON CORPORATE TAX BASE (CCTB)
The EU Parliament Research Service has produced a briefing paper on the CCTB.
CHEMICAL MUNITIONS USED BY THE SYRIAN GOVERNMENT 2012-2018
The Bellingcat website on 14th June posted an article that examines the chemical munitions documented through open sources, primarily used to deploy Sarin and chlorine gas.
CENTRAL BANK OF CYPRUS TO CRACK DOWN ON SHELL COMPANIES
Finance Magnates on 15th June reported that the Central Bank of Cyprus (CBC) is to crack down on shell companies in a bid to boost its AML/CFT efforts and is issuing a new set of definitions on what constitutes a shell company under its Directive for the Prevention of Money Laundering and Terrorist Financing. The article says that the decision appears in part due to pressure from the US. The article says that companies with no physical presence in Cyprus, who engage in no economic activity, that are registered in jurisdictions where they do not have to submit independently audited accounts to authorities, or which are based in tax havens, or who have no tax residence, will be included in the CBC’s new definition of a shell company.
CONSTRUCTION SERVICES WILL BECOME SUBJECT TO UK VAT REVERSE CHARGE FROM OCTOBER 2019
Out-Law on 15th June carried an article saying that 1st October 2019 a VAT reverse charge will apply in the UK to supplies of construction services, meaning 100,000 to 150,000 businesses in the construction and building sectors will have to change their accounting systems. It explains the change and provides a link to the relevant draft regulations.
FCA WARNS AGAINST CAR INSURANCE 4 U CLONE FIRM
In the UK, the Lear Rate website reported on 15th June that the FCA has put out details of a clone of legitimate, Wolverhampton insurance broker, Car Insurance 4 u. Fraudsters are using the details of firms, authorised by the FCA, to try to convince people that they work for a genuine, authorised firm.
UK NON-DOM REFORMS: PROTECTED TRUSTS AND NON-REPORTING FUNDS – A SURVEY FOR COMPLETION BY OFFSHORE TRUSTEES
On 15th June, the Chartered Institute of Taxation launched a survey to indicate approximately how many Protected Trusts that have investment portfolios hold non-reporting funds. Offshore trustees are asked to complete the survey.
CHINESE CUSTOMS OFFICIALS HAVE SEIZED HUGE AMOUNTS OF FAKE FIFA WORLD CUP
Sputnik on 15th June reported that among the counterfeit products impounded by customs officers are soccer balls, jerseys and shirts.
BRAZIL IMPOSES STRICTER ENVIRONMENTAL CONTROLS FOR MINING
The Herald Tribune reported that President Michel Temer has signed into law new standards for mining which, among other requirements, expand the environmental liability of companies exploiting mineral resources in Brazil. Last year, according to Mining and Energy Ministry data, mining accounted for 4% of GDP and exports totalled $46.5 billion, or 21% of the country’s total exports.
SWITZERLAND REMAINS BIGGEST OFFSHORE WEALTH CENTRE
Swissinfo on 15th June reported that Switzerland is still the world’s biggest centre for managing offshore wealth at $2.3 trillion. It reports that figures revealed in a Boston Consulting Group report put the country ahead of Hong Kong ($1.1 trillion) and Singapore ($900 billion). The Swiss sum is the equivalent of almost one third of all global overseas wealth. However, it seems that the 2 Asian centres have grown at yearly rates of 11% and 10% respectively over the past 5 years, compared with the 3% rate of Switzerland.
UK TO DELAY FOBT CRACKDOWN BUT RAISE ONLINE GAMBLING TAX
Gambling Insider on 15th June reported that the UK government’s crackdown on fixed odds betting terminals (FOBT) is to be postponed until 2020. In May, the UK said it would lower the maximum stake for FOBT from £100 to a £2; but with a higher tax rate on online gambling services in the April 2019 budget to compensate for the loss of tax revenues from lower FOBT profits – expected in Budget 2019
TEXAS MAN SENTENCED FOR MONEY LAUNDERING CONSPIRACY LINKED TO MEDICINES FRAUD
On 15th June, the DoJ published a news release saying that Marcus T. Weathersby conspired with others to facilitate the fraudulent sale of second-hand prescription medications to a Utah-based wholesale distributor as new products. This scheme involved purchasing bottles of prescription medications from illegitimate sources and then selling the medications to another wholesale distributor who then sold them to pharmacies as new.
COLOMBIA’S RAMPANT CORRUPTION A HOT TOPIC IN PRESIDENTIAL VOTE
Reuters on 15th June says that, with the ending of the conflict with FARC guerrillas, voter focus has shifted to other electoral issues and a rash of high-profile corruption cases have taken centre stage.
BOSNIAN COURT REFUSES TO EXTRADITE FORMER DINAMO ZAGREB BOSS
Reuters on 15th June reported that a Bosnian court has refused to extradite the former manager of soccer club Dinamo Zagreb to Croatia where he was sentenced to more than 6 years in prison for tax evasion and embezzling profits from player transfers. Mamic has dual Bosnian and Croatian citizenship but Bosnia, like Croatia, does not extradite its citizens to other countries and will only do so under specific terms.
EU TOP COURT AFFIRMS ASSET FREEZE OF BASHAR AL-ASSAD’S COUSIN
Jurist on 15th June reported that the appeal by Syrian President Bashar al-Assad’s cousin, Rami Makhlouf, had been dismissed by the ECJ. Makhlouf failed to meet the burden of proof in showing that he was not connected to the regime and was found to be associated with and supporting the regime.
HONDURAS ANTI-CORRUPTION PROBE IMPLICATES PRESIDENT AND OPPOSITION
Insight Crime on 15th June reported that the authorities in Honduras have accused dozens of officials and collaborators of diverting millions of dollars of public money for political purposes, including to fund President Juan Orlando Hernández’s 2013 campaign. A report to the country’s Supreme Court with information about 38 government officials and other individuals accused of misusing around $12 million of government funds. Those accused allegedly stole public funds destined for agricultural development projects, which they then funnelled through various foundations and non-governmental organizations before using the money for political purposes.
ICO £80,000 PENALTY FOR POLICE FOR REVEALING IDENTITIES OF ABUSE VICTIMS
On 15th June, Local Government Lawyer reported that a police force has been hit with an £80,000 monetary penalty by the Information Commissioner’s Office after it sent a bulk email that identified victims of non-recent child abuse. Gloucestershire Police was at the time of the incident investigating allegations of abuse relating to multiple victims. Each recipient of the email – including victims and witnesses – could see the full names and e-mail addresses of all the others. The email also made reference to schools and other organisations being investigated in relation to the abuse allegations.