20th October 2018
CHINESE TOURISTS VISITING US REMINDED OF RULES ON CELLPHONE CHECKS AT CUSTOMS
The South China Morning Post on 20th October reported that Chinese visitors to the US have been reminded they may be asked to hand over their phones and other electronic devices to customs agents on arrival by China’s embassy in Washington. US media have reported cases where individuals were denied entry to the country or even charged for carrying materials on their devices they intended to use to enable them to stay or work in the country illegally. Customs agents conducted 60% more searches in the year that ended in September than they did in the previous 12 months.
EUROPE USING US ITAR EXPORT CONTROLS AS REASON TO EXCLUDE US COMPANIES FROM ARMS PROCUREMENT?
An article in Who’s Who Legal in September argues that it appears European countries are seeking to exclude from procurement bids goods and components that are likely to be subject ITAR control. The International Traffic in Arms Regulations provide the regulatory framework intended to control the manufacturing, export and proliferation of arms, related goods, services and technologies. ITAR do not only specify reporting obligations for contractors, but also contain strict restrictions on use, import, export and end-use of regulated products. The author says that ITAR restrictions are increasingly exploited as an instrument by European contracting authorities, and while no state can afford to essentially “blacklist” US products or arms manufacturers altogether, European nations appear to leverage ITAR restrictions to favour European contractors over those with US involvement in specific cases. It says that use of ITAR-free clauses in EU procurement is certainly not exclusively attributable to protectionist intentions – ITAR restrictions do in fact frequently tend to complicate and delay international procurement. It gives the example of a sale of a reconnaissance satellite to the UAE delayed due to the inclusion of US components.
UK AMENDS EXPORT CONTROL ORDER 2008 AND PUBLISHES FIREARMS EXPORT GUIDANCE
The National Law Review on 19th October reported that the UK had amended the Export Control Order 2008 from September 14th to extend firearms controls to include devices capable of being converted to firearms, and to update the consolidated control list of strategic military and dual-use items that require an export licence. Devices for firing blanks, irritants or other substances, and devices for firing pyrotechnic rounds, or for salute and acoustic applications that are capable of being converted to a “firearm” are now subject to export controls.
NEWSWEEK’S FORMER OWNER IS CHARGED IN $10 MILLION FRAUD
Business Times on 20th October reported that 2 publishing companies, IBT Media, which owned the magazine, and Christian Media, a faith-based online publisher in Washington, were charged with trying to defraud lenders by pretending to borrow money for sophisticated computing services. Instead, most of the money was funnelled back to accounts controlled by the two media companies and their principals, and some of the money had been used to cover the magazine’s operating expenses. The men were charged with misrepresenting Newsweek’s financial health and creating a fictitious accounting firm, Karen Smith LLP, along with a series of fake financial statements to dupe lenders.
FORMER US NAVY COMMANDER SENTENCED TO PRISON IN CONNECTION TO ‘FAT LEONARD’ BRIBERY SCANDAL
NBC News in San Diego on 19th October reported that Troy Amundsen had been sentenced to 30 months in prison and will pay more than $31,000 in fines and restitution as part of the fallout from an investigation involving former defence contractor Leonard Glenn Francis, also known as “Fat Leonard”. Amundson was responsible for co-ordinating the Navy’s joint military exercises with foreign partners and was in charge of building and maintaining co-operative relationships with those partners.
SOTHEBY’S HIT BY $5 MILLION ART AUCTION FRAUD
Zero hedge on 19th October reported that a fine art consultant in New York and an interior designer in Florida stole an elderly woman’s identity and used it to bid millions of dollars on famous paintings and defraud the renowned Sotheby’s auction house, federal prosecutors in Florida alleged.
NORTH KOREAN HACKING GROUP LAZARUS BEHIND $571 MILLION IN HACKS SINCE JANUARY 2017
Nasdaq.com on 19th October reported that North Korean cybercrime hacking group The Lazarus Group (aka Hidden Cobra) is currently the biggest crypto-hacking syndicate in the world, having stolen millions worth of cryptocurrencies from online exchanges. The article tells of a report which outlines trends in hi-tech cybercrime, detailing 14 different attacks on cryptocurrency exchanges since January 2017, and suggesting that Lazarus has been responsible for the disappearance of over $571 million in cryptocurrency. It says that cybercriminals can create fake web pages, simulating a real project, tricking investors who are desperate to jump in on the next big thing; and the report notes that large phishing groups have become so skilled in their craft, they can steal as much as $1 million in a day.
CHOOSING BETWEEN CRIMINAL OR CIVIL REMEDIES IN FRAUD CASES
The Law Society Gazette on 19th October carried an article by a partner at Peters & Peters starts out by saying that one of the first decisions a victim of fraud will have to make – often at a very distressing time and before all the facts are known – is whether they should make a criminal complaint to the authorities or pursue their own civil remedy. There are, he says, a number of guiding principles which will aid any client or their advisers in determining which is the best course of action; and that, inevitably, cost will be an important factor.
NORTH KOREAN SECURITY AGENTS CONFISCATE, THEN SELL SMUGGLED MUSHROOMS
Customs Today on 19th October reported on the smuggling of pine mushrooms from North Korea to China, where they are considered a delicacy. They are said to being seized from private traders by security agents, who sometimes sell the sought-after delicacy to smuggling gangs and pocket the profits.
MAURITIUS GOVERNMENT STRENGTHENS AML LEGISLATION
Appleby on 20th October published an article which discusses the enhanced measures implemented to strengthen the AML legislative framework through the Financial Intelligence and Anti-Money Laundering Act, and the “noteworthy” replacement of the FIAMLA Regulations 2003 with a new version, which came into force on 1st October.
THE FAILED WAR ON DRUGS HAS MADE VULNERABLE COMMUNITIES VICTIMS OF DEADLY NEW PSYCHOACTIVE SUBSTANCES
Illicit Trade on 18th October carried an article saying that a group of international researchers last month warned that new psychoactive substances (NPS) such as synthetic cannabinoids Spice and K2 could be the cause of greater harm to users than more traditional mind-altering substances and stimulants including MDMA and cocaine. The team had discovered that so-called “legal highs” are more dangerous than traditional illegal drugs, and are in some cases more likely to induce conditions such as psychosis and schizophrenia. As is the case with much of the illicit fentanyl flooding into the US, the majority of legal highs that are sold in the West are produced by Chinese drugs factories. The European Monitoring Centre for Drugs and Drug Addiction revealed an increase in the number of vulnerable people injecting NPS, and said that so-called legal highs continued to represent a considerable public health challenge for European countries. The irony here is that if it were not for the decades-long failed war on drugs, the scientists behind NPS would have no reason to create them.
FORMER PERUVIAN SUPREME JUDGE ARRESTED IN SPAIN FOR CORRUPTION
Telesur on 19th October reported that former Supreme Court judge Cesar Hinostroza was arrested in Spain. Cesar Hinostroza has been implicated in a widespread corruption scandal that has infiltrated several branches and all levels of government.
SCRAP STEEL SMUGGLING IN CHINA
On 6th June, Illicit Trade published an article about a scrap steel smuggling ring that was said to have illegally sold more than 2.4 million tonnes of metal to buyers across SE Asia, avoiding the 40% export tax. An operation targeted some 65 gangs, members of which are thought to have avoided paying duty on the export of goods estimated to be worth $750 million. Vietnam was the largest buyer of Chinese scrap steel last year. Shipments of scrap steel originating from China rose from close to nothing in 2016 to around 2.2 million tons last year after the government launched a crackdown on illegal plants using scrap to make poor-quality steel.
RESEARCHERS DEVELOP NEW ‘FINGERPRINT’ TRACKING METHOD FOR 3D-PRINTED GUNS
Illicit Trade on 20th October reported that a team of scientists at the University at Buffalo has found that no two 3D printers are the same, and that all have their own “fingerprints”, and they claim to have developed what they describe as the world’s first accurate method for tracing a 3D-printed object to the device on which it was made.
ASIA OIL BUYERS SAID TO SEE MORE CHANCE FOR US SANCTIONS WAIVERS ON IRAN
On 20th October, Hellenic Shipping News reported that Asian buyers of Iranian oil are gaining confidence they will win US consent for some imports to continue even after US sanctions snap back next month. It also says that, if South Korea, India and Japan obtain waivers, it’s likely to be for lower imports than in the past with a commitment to continue reducing purchases over time. However, top Iranian customer China is said to remain a wildcard. Its government has said it opposes unilateral measures by the US.