27th December 2018
SCOTLAND: LIMITED PARTNERSHIPS RESPONSE “A MAJOR DISAPPOINTMENT”
An opinion piece in the Herald in Scotland on 27th December outlines the proposals to curb the misuse of Limited Partnerships but says that the response will leave many anti-corruption campaigners now challenging the maxim that “good things come to those who wait”.
BUILDING OF GUPTAS’ INDIAN TEMPLE HALTED AMID MONEY LAUNDERING CLAIMS – REPORT
The Citizen in South Africa reported on 23rd December that construction of the Shivadham Temple has been brought to a halt following an investigation into how the temple was funded, with money laundering allegations tainting the planned place of worship, meant as a dedication to Lord Shiva in honour of the Gupta brothers’ father. The Guptas are widely believed to be behind the alleged capture of the South African state, which is being investigated at the ongoing commission of inquiry into State Capture. It says that South Africa apparently put pressure on Indian authorities to investigate the source of the funds for the Hindu temple.
MAKING TAX DIGITAL
On 24th December, the House of Commons Library published a briefing paper on Making Tax Digital – the HMRC strategy to implement a new system of digital tax accounts to be used by businesses, the self-employed and landlords. Following a consultation exercise last year, in July 2017 the Government confirmed its plans to roll-out digital tax returns, but with an amended timetable in light of concerns about the potential impact on businesses. This paper discusses the background to this reform.
https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-7949
SAMOA GOVERNMENT GETS TOUGHER ON TAX-AVOIDING CHURCH MINISTERS
Radio New Zealand on 27th December reported that the revenue minister plans to further tighten the screws on the country’s largest church, where 19 ministers already face court for tax evasion, as the Congregational Christian Church is refusing to abide by a new law that requires pastors to pay income tax for the first time.
NEW REQUIREMENTS FOR VIRTUAL CURRENCY EXCHANGE AND WALLET SERVICES PROVIDERS IN ESTONIA
On 20th December, Sorainen published an article saying that the Estonian Ministry of Finance has introduced a draft law amending the Estonian Money Laundering and Terrorist Financing Prevention Act. One of the main amendments affects providers of virtual currency to fiat currency exchange and virtual currency wallet services and the procedure for authorising service providers.
https://www.sorainen.com/UserFiles/File/Publications/newsflash-banking-dec-2018%5B1%5D.html
NEW ICO GUIDANCE ON “DATA PROTECTION IF THERE’S NO BREXIT DEAL”
On 18th December, Lewis Silkin published an article saying that, with uncertainty about Brexit continuing to dominate the headlines, the Information Commissioner’s Office has released some useful and practical guidance on key data protection issues if there is no Brexit deal. The guidance was followed shortly thereafter by a Technical note from the Government.
http://www.lewissilkin.com/Insights/NEW-ICO-guidance-on-Data-protection-if-there-is-no-Brexit-deal
The Guidance and technical note are available at –
IRELAND IMPLEMENTS 4MLD: KEY CHANGES FOR DESIGNATED PERSONS
Maples on 20th December published an article saying that the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 transposes the majority of the 4th Money Laundering Directive (EU) 2015/849 into Irish law. The update summarises the key changes under the Amendment Act and how it affects Designated Persons. It explains that a Designated Person includes credit and financial institutions, auditors, relevant independent legal professionals, trust or company service providers, property service providers, persons who provide gambling activities and persons trading in goods that involve cash transactions of at least €10,000. The definition of financial institutions has been updated in the Amendment Act for consistency with EU regulations.
AUSTRALIA: PLEDGE TO CRACK DOWN ON TAX AVOIDANCE ACHIEVES ALMOST NOTHING IN 3 YEARS
On 21st December, Baker McKenzie reported that, almost 3 years after making the promise, the coalition government has made no progress in establishing a register designed to crack down on multinational tax avoidance. Following the Panama Papers the Australian government agreed to establish a public register of beneficial ownership of shell companies.
FORMER CFO OF NEW YORK-BASED LENDER SENTENCED
On 21st December, Baker McKenzie reported that the former CFO of Vanguard Funding, Edward Sypher Jr., 42, was sentenced to 18 months in prison after taking loan money for his personal use.
AFRICAN SLAVES CUT OPEN FOR THEIR KIDNEYS IN LIBYA’S BURGEONING ORGAN TRAFFICKING MARKET
The International Business Times on 5th December carried a feature saying that an undercover operation exposed Libya’s slave market where desperate immigrants are sold as manual labourers; and a Ghanaian lawyer claims trafficking in the country is being used to facilitate the illegal sale of human organs and encourage a lucrative “red market”.
AS NICARAGUA SLIDES DEEPER INTO DICTATORSHIP, OTHER NATIONS GROW ALARMED
On 27th December, the Pass Blue website published an article saying that governments of 14 democratic nations in Europe, the US, Chile and Australia condemned the closing, banning or expulsion of civil-society organisations working on rights and governance issues in Nicaragua. The censure came as violence is again being used against Ortega’s critics.
HMRC: HELP AND SUPPORT FOR MONEY LAUNDERING SUPERVISION
On 27th December, HMRC published updated information on webinars and online courses that can be used to find out more about money laundering supervision. Available webinars are listed by subject and can last up to an hour. The information is aimed at accountancy service providers, estate agencies, high-value dealers, MSB and TCSP.
https://www.gov.uk/guidance/help-and-support-for-anti-money-laundering
RUSSIA FILES INTERPOL ALERT ON BRITISH HUMAN RIGHTS ACTIVIST BROWDER
EU Observer on 27th December reported that Russia had requested an Interpol alert for Bill Browder, a British campaigner for sanctions on Russia – the 7th time Russia has sought his detention and extradition. Previous requests were deleted on grounds that they were “politically motivated”, but one of them led to Browder’s brief arrest in Spain last year.
https://euobserver.com/tickers/143791
EU DIRECTIVE ALLOWS GENERAL REVERSE-CHARGE MECHANISM TO TACKLE VAT FRAUD
On 27th December, EU Council Directive 2018/2057/EU was published. This allows Member States to opt to introduce a generalised reverse charge mechanism (GRCM) on non-cross-border supplies for limited time, i.e. to 30th June 2022. It comes into force on 20th January.
EU PUBLISHES COUNTERFEIT AND PIRACY WATCH LIST
An article from HK TDC on 27th December is concerned with the Watch List which specifically targets widespread counterfeiting and piracy at a commercial scale, in an effort to alleviate the high financial losses caused to European intellectual property right-holders. The Watch List also aims to eliminate the link between counterfeits and risks to consumer welfare insofar as counterfeit products are subject to scant quality controls and certification protocols during manufacture. The article notes that the Watch List is not an exhaustive list of reported marketplaces and service providers, nor an official finding of legal violations. However, the EU Commission services will update the Watch List every 2 years, monitoring the measures and actions taken by relevant domestic actors with respect to the listed marketplaces to curb IP infringements. The Watch List only identifies marketplaces – physical and online – located outside the EU, and the majority of physical marketplaces and e-commerce marketplaces were reported to operate from mainland China or SE Asian countries. The article concludes by saying that, with over 80% of counterfeit and pirated goods seized in the EU originating in mainland China or Hong Kong, Hong Kong operators should be aware that the Commission has raised particular concerns with respect to copyright piracy and counterfeit pharmaceuticals in these jurisdictions.
VATICAN COURT CONVICTS ITALIAN BUILDER OF MONEY LAUNDERING
The Catholic Herald on 27th December reported that a court in The Vatican had sentenced Angelo Proietti, 63, an Italian contractor, who had done work for several Vatican offices, to 2½ years in jail for using a Vatican bank account for money laundering. It also ordered the confiscation of the more than €1 million he had in his account at the Institute for the Works of Religion – the Vatican bank. The AML/CFT laws were part of a Vatican effort, which is ongoing, to ensure the Vatican bank and other Vatican financial operations were transparent and could not be used for tax evasion or other crimes.
https://catholicherald.co.uk/news/2018/12/27/vatican-court-convicts-italian-of-money-laundering
ARMENIAN TYCOON SAMVEL MAYRAPETIAN FREED ON BAIL
Azatutyun on 27th December reported that a court in Yerevan has granted bail to prominent Armenian businessman Samvel Mayrapetian, who was arrested nearly 3 months ago on corruption charges which he flatly denies. One of Armenia’s leading real estate developers who also owns a national TV channel and a car dealership, his company was involved in a controversial redevelopment of old districts in downtown Yerevan during the 1998-2008 rule of former President Robert Kocharian.
https://www.azatutyun.am/a/29679782.html
LIBYAN PORTS PUT A CAP ON FOREIGN CURRENCY TRANSFER, IN OR OUT OF THE COUNTRY
The Libya Observer on 27th December reported that the National Anti-Money-Laundering and Counter-Terrorist Financing Committee had issued a decision which put a ceiling of $10,000 or its equivalent in other foreign currencies for funds allowed in or out of the country at the individual level. Any amount exceeding the amount specified in the resolution should be disclosed to the Libyan Customs authority.
https://www.libyaobserver.ly/inbrief/libyan-ports-put-cap-foreign-currency-transfer-or-out-country
PROPERTY DEVELOPERS BANNED OVER £12 MILLION INVESTMENT SCAM
Property Developer on 27th December reported that 6 directors have been banned for a total of 54 years after they misled more than 300 people to invest £12 million into residential property developments. 4 of the directors are based in Malaysia. Property development company, Absolute Living Developments, sold apartments in England off-plan to investors who were largely based in Asia. Absolute Living Developments was wound-up by order of the courts in April 2016.
https://www.propertyreporter.co.uk/finance/property-developers-banned-over-12m-investment-scam.html
CROSS-BORDER E-COMMERCE: EUROPEAN COMMISSION IMPOSES A FINE OF €40 MILLION ON GUESS FOR GEO-BLOCKING
On 18th December, Field Fisher reported that the EU had imposed a fine of around €40 million on clothing company Guess for the illegal design of its selective distribution system after Guess had prohibited its authorised distributors addressing online advertising or online selling to consumers of other Member States (so called “geoblocking”). Due to its extensive cooperation with the European Commission in this procedure, Guess was granted a reduction of fines of 50 %.
FIJI: EX-ACTING DEPUTY OFFICIAL RECEIVER COPS 23 YEARS FOR FRAUD
The Fiji Times on 27th December reported that the former acting deputy official receiver of the Ministry of Justice, Viliame Katia, has been sentenced to 23 years imprisonment after being convicted of 11 counts of corruption-related offences. The total amount involved was $4.1 million.
https://www.fijitimes.com/ex-acting-deputy-official-receiver-cops-23-years-for-fraud
2 MORE ISRAELI WOMEN CHARGED IN US IN BINARY OPTIONS FRAUD CASE
On 27th December, the Times of Israel reported that they are accused of working as sales representatives to swindle millions of dollars out of victims, and have pleaded guilty to conspiracy charges. It says that the multimillion-dollar investment fraud scheme has already led to federal charges in Maryland against 2 more women who worked for Israel-based company Yukom Communications, including a former Israeli TV reality star. Yukom employees pretended to be from other countries, lied about their professional qualifications, and adopted “stage names,” authorities say. They falsely guaranteed returns of up to 40%.
https://www.timesofisrael.com/2-more-israeli-women-charged-in-us-in-binary-options-fraud-case
NEW ALLEGATIONS AGAINST GHOSN “CONCERN PAYMENTS TO SAUDI BUSINESSMAN”
On 27th December, KYC 360 reported that fresh misconduct allegations brought by Tokyo prosecutors against ousted Nissan Chairman Carlos Ghosn centre on the use of company funds to pay a Saudi businessman who is believed to have helped him out of financial difficulties, company sources with knowledge of the matter said.
https://kyc360.com/news/new-allegations-against-ghosn-concern-payments-to-saudi-businessman-sources/
RUSSIA PLAYS DOWN IDEA OF FORMING JOINT OIL ORGANISATION WITH OPEC GIVEN US SANCTIONS RISK
On 27th December, Hellenic Shipping Report reported that Russian Energy Minister Alexander Novak has said that it is highly unlikely that OPEC and other oil producers would set up a joint structure due to the additional red tape it would create as well as the risk of US monopoly-related sanctions. It refers to proposed US legislation known as “NOPEC” could open OPEC up to anti-trust (i.e. anti-monopoly) lawsuits but has long laid dormant, with previous US presidents (i.e. before Trump) signalling that they would veto any move to make it law.
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