OTHER THINGS YOU MAY HAVE MISSED – OCTOBER 27

27th October 2018

BAHAMAS HIT BY NEW FINANCIAL BLOW – INCLUDED AMONG 11 COUNTRIES WITH “STRUCTURAL DEFICIENCIES” IN AML/CFT REGIMES

Tribune 242 on 26th October reported that the Deputy Prime Minister, told Tribune Business that “institutional strengthening” will be a key element in the Government’s response to the FATF inclusion of this nation among 11 countries with “structural deficiencies” in their AML/CFT regimes.  It identified 7 areas (listed in the article) where the Bahamas needs to improve under an “action plan” agreed with the Government, and placed strong emphasis on the need for this nation to implement and enforce the anti-financial crime laws on the statute book.  In particular, it says, FATF indicated it wants to see more money laundering/terror financing investigations and prosecutions, and an increase in STR filed with the FIU.  The Caribbean Financial Action Task Force (CFATF), last year found that the level of such enforcement activity was insufficient for a nation with such a large financial services sector.  Despite not being blacklisted, the article says, the Bahamas’ inclusion on the FATF list represents another reputational risk for the country and its financial services industry that could deter current and potential clients/investors from doing business with it.  It also says that the focus on access to beneficial ownership information on all Bahamas-domiciled entities shows where pressure for the Register of Beneficial Ownership Bill stems from.

http://www.tribune242.com/news/2018/oct/26/punching-bag/

PAKISTAN REGULATOR DIRECTING BANKS TO REQUIRE STAFF SIGN ANTI-TERROR AFFIDAVIT, PLEDGE THEY, FAMILY, ASSOCIATES NOT TIED TO, SUPPORTING ILLICIT GROUPS

ACFCS on 26th October reported that the State Bank of Pakistan (SBP) has directed all banks and development financial institutions (DFI) to provide an affidavit stating that anyone of their employees is not affiliated to a terrorist organisation.

https://www.acfcs.org/news/424543/Financial-Crime-Wave–OFAC-hits-Singapore-broker-on-North-Korea-Latvian-AML-fine-and-more.htm

TUNISIA: BAD RANKING, BECAUSE OF “WIDESPREAD CORRUPTION PRACTICES”

African Manager on 26th October carried an article saying that Tunisia is ranked 53rd out of 84 countries, by the Global Illicit Trade Environment Index which measures the enabling environment for illicit trade that economies create through both action and inaction.  The prime minister is quoted as saying that Tunisia’s war on corruption introduces useful measures to reduce illegal trade, but as long as corruption persists in customs, any attempt to strengthen border surveillance and control will have only a limited impact.  A recent report also said that Tunisia needs to strengthen controls on money laundering by adopting a comprehensive AML regime to locate, freeze, seize and confiscate assets related to illicit financial flows; and Tunisia faces the need to take proactive measures to protect the country from illicit goods passing through the free trade zones.

https://africanmanager.com/site_eng/tunisia-bad-ranking-because-of-widespread-corruption-practices/?v=7c78ebb4c223

The report is at –

https://www.tracit.org/uploads/1/0/2/2/102238034/tunisia_country_report_final.pdf

COMMERZBANK PILOTS FINTECH TOOL TO AUTOMATE 80% OF TRADE FINANCE COMPLIANCE CHECKS

Global Trade Review on 23rd October reported that Commerzbank is piloting a fintech solution that will see it automate 80% of its “first line of defence” compliance checks of its trade finance processes by 2020 – but does not affect any downstream internal oversight, compliance and audit processes.  The bank has announced it is working with Conpend, a fintech firm that uses optical character recognition (OCR) and machine learning to digitise physical trade documents, recognise patterns and flag deviations.  The firm also conducts automatic document checking and sanctions screening.  At first, the pilot will see Conpend automate Commerzbank’s AML processes, and, after an evaluation process, the bank plans to also implement further checks in trade finance next year.

https://www.gtreview.com/news/fintech/commerzbank-pilots-fintech-tool-to-automate-80-of-trade-finance-compliance-checks/

US STUDY FINDS RISING NON-CASH PAYMENTS FRAUD, WITH CRIMINALS TURNING MORE AGGRESSIVELY TO ACH FOR SPEEDY, HEFTY HAULS

ACFCS on 26th October reported that the value of fraudulent non-cash payments in the US rose significantly between 2012 and 2015 – outpacing growth in non-cash payments overall, according to new Federal Reserve report.  The report provides estimates of payments fraud totals and rates for payments processed over general-purpose credit and debit card networks, including non-prepaid and prepaid debit card networks, the automated clearing house (ACH) transfer system, and the check clearing system.  These payment systems form the core of the non-cash payment and settlement systems used to clear and settle everyday payments made by consumers and businesses in the US.

https://www.finextra.com/pressarticle/75902/fed-study-finds-rising-noncash-payments-fraud

JAPANESE REGULATOR RECOGNISES CRYPTO SELF-REGULATORY BODY JVCEA

ACFCS on 26th October reported that the regulatory authority in Japan, the Financial Services Agency (FSA) has announced support for the cryptocurrency-self regulatory body.  The Japan Virtual Currency Exchange Association (JVCEA) has now been tasked with the mandate to oversee the operations of exchanges based in the country.

https://www.acfcs.org/news/424543/Financial-Crime-Wave–OFAC-hits-Singapore-broker-on-North-Korea-Latvian-AML-fine-and-more.htm

“FLAG IT UP” CAMPAIGN: VITAL FOR ACCOUNTANTS TO GET INVOLVED

Accountancy Age on 26th October reported that the Association of Accounting Technicians (AAT) has urged UK accountants to support the government’s ‘Flag It Up’ campaign – an AML campaign that promotes the improvement of communication when reporting the suspicious behaviour of a client or company, or suspicious financial anomalies, and warns that accountants need to know the ‘red flags’ in order to tackle money laundering problems in the UK.

https://www.accountancyage.com/2018/10/26/flag-it-up-vital-for-accountants-to-get-involved/

MALTA’S APPROACH TO DIGITAL CURRENCIES ‘PROACTIVE’ – REPORT

Malta Today on 26th October reported that Malta is one of only 7 jurisdictions which was found to have an ‘evident proactive approach’ in regard to Initial Coin Offerings (ICO) and digital currencies in recommendations drawn up for the European Securities and Markets Authority.  The other jurisdictions are Switzerland, Lithuania, Gibraltar, Jersey, the Isle of Man and France.  The goal of this report was to advise ESMA on ways to contain the risks of ICO and virtual currencies, on top of existing regulation, mainly with regards to risks for investors. 36 jurisdictions were covered, and the SMSG found that not all countries had taken the same approach.

https://www.timesofmalta.com/articles/view/20181026/local/maltas-approach-to-digital-currencies-proactive-report.692612

ROMANIA CRIMINAL JUSTICE REFORM PROPOSAL WEAKENS FIGHT AGAINST CORRUPTION AND SERIOUS CRIME

The Council of Europe on 19th October reported that its Venice Commission expresses concern that many draft amendments to the Criminal Code and the Criminal Procedure Code in Romania seriously weaken the effectiveness of its criminal justice system to fight corruption offences, violent crimes and organised criminality.

https://www.coe.int/en/web/portal/-/proposed-reform-of-criminal-justice-legislation-in-romania-weakens-the-fight-against-corruption-and-other-serious-crimes-according-to-venice-commissio

KENYA CRIME FAMILY MEMBERS PLEAD GUILTY TO DRUG CHARGES

Defence Web on 26th October reported that 2 brothers, accused by US prosecutors of playing key roles in a major Kenyan crime family called the Akasha organisation, pleaded guilty to drug trafficking charges in New York.  The case arose from a US DEA probe into the Akasha organisation, which US authorities describe as a major smuggling operation connecting the poppy fields of Afghanistan to European and US cities.  All 4 defendants were arrested in Mombasa, Kenya, in November 2014 in a US-led sting operation.  The Akasha family has been involved in the drug trade for years, according to US diplomatic cables published by WikiLeaks.  The Satao Project, a private company focused on fighting poaching, said the Akasha network was linked to around 30 tons of ivory seizures.  US prosecutors said Baktash Akasha was leader of the organisation.

http://www.defenceweb.co.za/index.php?option=com_content&view=article&id=53546:kenya-crime-family-members-plead-guilty-to-drug-charges&catid=113:international-news&Itemid=248

UK: WASTE OPERATORS TO PAY BACK ILLEGAL EARNINGS

Commercial Motor on 26th October reported that 2 waste operators have been ordered to pay back hundreds of thousands of pounds of money they illegally earned following a proceeds of crime case brought by the Environment Agency.

https://www.commercialmotor.com/news/compliance/waste-operators-pay-back-illegal-earnings

CHINA TELLS STATE-OWNED GIANTS TO HALT IRAN OIL BUYING

Hellenic Shipping News on 27th October reported that China’s government has told at least 2 of its state oil companies to avoid purchasing Iranian oil as the US prepares to impose sanctions.  The freeze on imports by China National Petroleum and Sinopec is temporary and purchases may resume depending on the outcome of negotiations with the US.  The decision precedes an upcoming meeting between President Xi and Donald Trump at the G20 summit next month.  The Chinese government’s move is in contrast to India, which has said it plans to continue taking limited volumes from the Persian Gulf state in November.  All nations are negotiating with the US for waivers from the restrictions.

https://www.hellenicshippingnews.com/china-tells-state-owned-giants-to-halt-iran-oil-buying/

FACEBOOK DELETES IRAN-LINKED ACCOUNTS FOLLOWED BY 1 MILLION IN US AND BRITAIN

Rferl on 27th October reported that Facebook says it has deleted accounts originating in Iran that featured posts on politically divisive topics and attracted more than 1 million followers in Britain and the US.  The social network said it deleted 82 accounts and pages on Facebook and Instagram that were “fake” and posted on divisive issues such as race, immigration, and President Trump — all of which it said were aimed at “sowing discord” ahead of US congressional elections on November 6th.

https://www.rferl.org/a/facebook-deletes-iran-linked-accounts-followed-by-1-million-us-britain-political-divisive-sow-discord/29566687.html

SPAIN TO BAN “NARCO LAUNCHES” – LARGE, POWERFUL RIGID-HULLED INFLATABLE BOATS

The Gibraltar Chronicle on 27th October reported that Spain has moved to ban large, powerful RHIB of the type used by criminal gangs to smuggle large shipments of cannabis resin across the Strait of Gibraltar from Morocco to Spanish shores; as is part of wider initiatives to crack down on drug traffickers operating in this region, although it applies across the whole of Spain.  Gibraltar banned this type of vessel in British waters around the Rock in 1995.

http://chronicle.gi/2018/10/spain-moves-ahead-with-ban-on-narco-launches/

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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