25th February 2019
WHY PEPPERCORNS ARE BEING SMUGGLED BY THE TON FROM VIETNAM TO SRI LANKA
On 24th February, Lankaweb published an article about the smuggling of peppercorns from Vietnam, the world’s leading exporter of the product. It says that, to bypass India’s high tariffs and minimum import prices, some rogue traders reportedly ship peppercorns to Sri Lanka, re-label them, and sell them on in India for a much higher profit than if they had exported them direct. India was once one of the world’s biggest pepper suppliers. But over time, demand has risen while production has not. The country now consumes almost all its locally grown pepper, leaving little for export.
UK ESTATE AGENTS DOING “NOT NEARLY ENOUGH” TO REPORT MONEY LAUNDERING
On 25th February, Estate Agent Today reported that the government’s AML campaign Flag It Up has published an A to Z which it claims will help agents understand the risks and signs of money laundering. It is said that, between April 2017 to March 2018, agents submitted “just” 710 SAR it says, despite the UK losing an estimated £37 billion each year through crimes facilitated by money laundering.
IRELAND: GARDAÍ SUSPECT GANG BRIBED DETECTIVE €20,000 FOR SECRET INFORMATION ON CAB PROBE
The Irish Independent on 25th February reported that a criminal gang is suspected of paying a serving detective €20,000 in return for secret information on the progress of a CAB investigation into the gang’s money laundering operation in Limerick. The officer at the centre of the enquiry, an experienced serious crime investigator, was arrested last month.
GOVERNMENT INVESTIGATIONS & WHITE COLLAR CRIMINAL DEFENSE REPORT
Vinson and Elkins has published this 60-page review of recent enforcement trends, in which it highlights the key US government enforcement policies and actions that it says technology sector professionals need to know. Its chapter on sanctions, for example, highlights –
- Voluntary disclosure and steps to remediate are key mitigating factors for OFAC resolutions;
- Failure to have compliance programmes in place increases not only the risk of violating sanctions prohibitions but also the risk of a large penalty; and
- China has been a focus of this administration, with the Department of Commerce and the DOJ taking actions against major Chinese companies ZTE and Huawei, respectively.
FRANCE’S ‘RANA PLAZA’ LAW DELIVERS FEW RESULTS
France wants to be at the forefront of efforts to regulate multinationals’ responsibility towards workers in developing countries, but is having difficulty enforcing its own law on duty of care, according to a report. The law is named after the name of a building in Bangladesh which collapsed in 2013, claiming the lives of more than 1,000 workers in the garment industry, the French piece of legislation stipulated that multinationals can be held accountable for their sub-contractor’s compliance with human rights in developing countries. The law requires French businesses with more than 5,000 employees to identify and prevent human rights and environmental violations from their or their sub-contractors’ operations abroad in monitoring plan. The French government has taken little action to enforce compliance.
MALTA: TUNA INSIDER – WIDESPREAD COVER-UP OF ILLEGALITIES
Malta Today on 25th February reported that a whistleblower working in the tuna farming industry told Malta Today about the abuse inside the business, detailing how it benefited from lax enforcement and got away with flagrant abuses – making millions in euros on undeclared tuna catches and illegal harvesting of tuna.
UKRAINE: MUSEUM OF CORRUPTION
City metric on 20th February published an article about a palace that sits within former President Yanukovych’s old estate of Mezhyhirya. The site was seized by protesters during the Maidan Revolution in 2014 and has since opened to the public as a national park, and Ukrainians can now rent golf buggies to inspect the peculiar sites: a fleet of classic cars, a galleon, a driving range and a private zoo. Styled as a Finnish log cabin, the building is a confused mishmash of Neoclassical, Alpine and Gothic motifs. Inside there are stuffed lions and stuffed alligators, suits of armour and snakeskin plant-pots, the deeds to a meteor and a $90,000 Steinway. It says that never have the profits of corruption been so neatly catalogued, and never has so much money been made to look so cheap.
THE FIRST-EVER “SOFT TOUCH” PROVISIONAL LIQUIDATION IN THE BVI
Ogier on 22nd February published an article about a “soft touch” provision liquidation. A “soft touch” joint provisional liquidation order leaves the management of the applicants in place, with the joint provisional liquidators overseeing and assisting in the restructuring process.
NEW EU REGULATION BOLSTERS CO-OPERATION IN NATIONAL SCREENING OF FOREIGN INVESTMENTS ACROSS EUROPE
Allen & Overy on 22nd February published an article about a new EU Regulation aimed at harmonising and co-ordinating the various national foreign investment screening mechanisms across the economic bloc – but does not foresee screening at EU level. It says that the key question for the international business community is whether the FDI Regulation will constitute an obstacle to investments in Europe.
US CANCELS ANTI-OPIUM AIRSTRIKE PROGRAMME IN AFGHANISTAN
Real Clear Defense on 22nd February reported that after hundreds of airstrikes failed to curtail the Taliban’s $200 million-a-year opium trade, the US military quietly ended a year-long campaign that targeted drug labs and networks laced around the Afghan countryside.
GET USED TO OIL TANKERS HAULING SEAWATER TO AMERICA
Hellenic Shipping News on 25th February reported that supertankers hauling seawater across the Atlantic are just one of the odder results of the US shale boom.
US IMPORTS OF ‘SANCTIONED’ VENEZUELAN OIL SURGE FIVE-FOLD
Hellenic Shipping News on 25th February reported that purchases of Venezuelan crude by US energy companies saw a 5-fold weekly growth as of the middle of February, nearly reaching their pre-sanctions level. It says that the US Treasury issued temporary permits for buying Venezuelan crude to foreign companies until the current deals are expired, and the companies find new suppliers with the deadline set by the White House to expire on April 28th.
OFSI IMPOSES FIRST SANCTIONS FINANCIAL PENALTY IN UK
On 25th February, the UK Office of Financial Sanctions Implementation reported a £5,000 penalty imposed for a self-reported violation of financial sanctions involving Egypt and valued at £200.
AT LEAST 4 US VETERANS AMONG GROUP ARRESTED IN HAITI WITH WEAPONS AND TACTICAL GEAR
The Task & Purpose website on 20th February reported that at least 4 US veterans were among a group of 8 men (5 Americans, 2 Serbs, and 1 Haitian) arrested by police in Haiti for allegedly driving without licence plates and possessing an arsenal of weaponry and tactical gear. The men reportedly told police they were on a “government mission” but did not specify for which government, according to the Miami Herald. At least 2 of the Americans was said to have links to “security” businesses – most were ex-US forces or special forces. On their arrival back in the US they were arrested (but not by the FBI, which denied involvement in the detentions). The Haitian involved remained detained in Haiti.
REPORTS OF US WEAPONS TRANSFERRED TO SUSPECTED TERRORISTS AND MILITIAS BY SAUDI COALITION
On 22nd February, (would-be presidential candidate) Senator Elizabeth Warren published a letter sent to the State Department and Department of Defense requesting information on the suspected re-transfer of American weapons from foreign governments to suspected terrorists, armed militias, and other unauthorised third-party, non-state actors. This followed a CNN investigation which claimed that Saudi Arabia and its coalition partners had transferred US-made weapons to al Qaeda-linked fighters, hardline Salafi militias, and other factions waging war in Yemen, in violation of their agreements with the US. The investigation also reported that some “weapons have also made their way into the hands of Iranian-backed rebels battling the coalition”.
AIR BRIDGE CARGO EXPANDS NETWORK TO BANGLADESH DESPITE SECURITY CONCERNS
On 25th February, Loadstar reported that the cargo airline AirBridgeCargo (ABC) is to take advantage of Bangladesh’s growing export market. One of the key issues preventing carriers from expanding in Dhaka had been security concerns at the airport, which have led to various bans on direct air cargo flights. Last year, Bangladesh was the second-largest global apparel exporter after China, and its garment industry is expected to benefit from the potential increase on US tariffs for Chinese goods.
EU MONITORING MISSION EVALUATES PROGRESS ON HUMAN RIGHTS AND LABOUR RIGHTS IN MYANMAR
On 25th February, the EU reported the return of a high-level mission of the European Commission and the European External Action Service (EEAS) from Myanmar as part of a broader engagement under the EU’s Everything But Arms (EBA) trade preferences scheme. The European Commission and the European External Action Service will now analyse the findings from the mission. The threat for Myanmar is the loss of its preferential trading relationship with the EU.
ARUBA ASKS US TO LIFT VENEZUELAN SANCTIONS AFFECTING ISLAND REFINERY
Reuters on 25th February reported that Aruba is asking the US to lift financial sanctions on a Citgo Petroleum Corp oil refinery that have led to job cuts on the Caribbean island, the nation’s prime minister said.
CONVICTED ISRAELI-BORN FRAUDSTER ILAN SHOR WINS SEAT IN MOLDOVA’S PARLIAMENT
The Times of Israel on 25th February reported that Israeli-born Moldavian businessman Ilan Shor, convicted in 2017 for money laundering, fraud and abuse of confidence, has been elected to Moldova’s parliament. He remains free pending his appeal — and was eligible to run for office in the parliamentary elections.
TAIWAN GOVERNMENT HOPES FOR BETTER AML/CFT REVIEW NEXT MONTH
On 25th February, the Taipei Times reported that Taiwan is hoping to earn an improved rating when an evaluation team from the Asia/Pacific Group on Money Laundering returns for a 4-day follow-up review next month, a Ministry of Justice official said. It underwent a review in November 2018 and the country hopes to improve upon the preliminary results of that mutual evaluation.
MAN CHARGED OVER MONEY LAUNDERING OPERATION WHICH SAW €360,000 STOLEN FROM MAYNOOTH UNIVERSITY
On 25th February, the Irish Examiner reported that Abiodun Adewolowo, 48, has been charged in connection with a money laundering operation during which over €360,000 was stolen from Maynooth University.
EXPORTING NUCLEAR-RELATED ITEMS AFTER THE UK LEAVES THE EU
On 25th February, the Department of Business, Enterprise and Industrial Strategy published an updated news release about actions companies need to take to continue to export nuclear-related items if the UK leaves the EU without a deal. Companies need to register to use the new OGEL before exporting dual-use items to the EU or the Channel Islands. Companies will continue to require an export licence to export Trigger List items to the EU and existing export licences will remain valid. Companies applying to export Trigger List items to the EU after exit day should allow additional time for applications to be processed.
GAMBLING ASSOCIATIONS IN THE UK TO MERGE?
Calvin Ayre on 25th February reported that gambling associations in the UK – the Remote Gaming Association and the Association of British Bookmakers – are combining forces and creating a new trade group that would lobby politicians in an effort to have a greater voice against a growing anti-gambling feeling.
LAWSUITS IN US PROVIDE A “WHO’S WHO” OF HEZBOLLAH FRONT COMPANIES AND AGENTS
Kenneth Rijock in his blog on 25th February reported 2 lawsuits filed in New York, involving a 610-page Complaint in the 2 cases filed against Hezbollah and all the banks in Lebanon that facilitate the terrorist organisation’s operations. He says that the information that can be found include names of every Hezbollah front entity in Lebanon, together with the names of each company’s leaders, and the rank-and-file Hezbollah agents who work there.
BREXIT AND CONTRACTS – A PRACTICAL GUIDE
On 25th February, Irish law firm Matheson published an article saying that for businesses one key consideration is the impact of events on their contractual relationships. It says that on 21st February, the English Courts tackled the issue of a Brexit argument in the context of a lease-related contractual dispute involving the European Medicines Agency in Canary Wharf.
FORMER HEAD OF VENEZUELA’S MILITARY INTELLIGENCE SERVICE: LONGSTANDING LINKS BETWEEN OFFICIALS IN THE MADURO REGIME AND ORGANISED CRIME AND TERRORIST GROUPS
Insight Crime on 25th February reported that Hugo Carvajal, the former head of Venezuela’s military intelligence service has revealed some key details that confirm longstanding links between several officials in the regime of President Nicolás Maduro with organised crime and terrorist groups. Carvajal, who is under investigation in the US for drug trafficking links, is distancing himself from Maduro.
ESTONIA: FORMER MINISTER’S FAMILY BUSINESS TRANSFERRED MILLIONS TO SHELL COMPANIES
On 25th February, Postimees reported that companies belonging to former interior minister Ain Seppik and his sons Sulev and Siim have transferred millions of dollars to shell companies – but he maintains the transactions are real and constitute normal business activity. Named is a UK LLP registered in a warehouse on the outskirts of London, with corporate shareholders registered in Dominica. The news site claims that the shell companies involved had “ties to several infamous money laundering schemes”, and provides details in the article.