6 March 2019
UK AND SPAIN BACK NEW TAX RULES FOR GIBRALTAR
On 6 March, KYC 360 reported that Spain and Britain have reached an agreement that sets out stricter rules for companies and citizens operating from Gibraltar. There are currently more than 55,000 Gibraltar-based companies, nearly double the number of registered residents.
https://www.riskscreen.com/kyc360/news/uk-and-spain-back-new-tax-rules-for-gibraltar/
ILLEGAL MEDICINE SEIZURES: 740 ABORTION PILLS WERE SEIZED IN IRELAND LAST YEAR
The Journal on 5 March reported on a report from the Health Products Regulatory Authority (HPRA), saying that there was a significant drop in the number of illegal medicines seized by Ireland’s medicine watchdog last year compared to the year previously. It seized 619,213 dosage units (including tablets, capsules and vials) of falsified and other illegal medicines in 2018, compared to 948,915 in 2017. However, the number of abortion pills seized rose considerably. Other medicines seized during 2018 included sedatives (36%), erectile dysfunction medicines (18%) and anabolic steroids (16%).
https://www.thejournal.ie/smuggled-medicines-abortion-pills-4524905-Mar2019/
DRUG SMUGGLERS HAVE IT EASY USING MALDIVES AND COLOMBO
The Hindu on 5 March reported that the Maldives and Colombo, Sri Lanka have emerged as major transit hubs for smuggling out hashish oil to European and Latin American destinations. It says that Customs officials cite the slack checking at the airports in the Maldives and Colombo.
CENTRAL BANK OF NIGERIA BLOCKS FOREX USE FOR TEXTILE IMPORTATION
All Africa reported on 5 March that the Central Bank of Nigeria (CBN) has placed access to foreign exchange for all forms of textile materials on the FOREX restriction list.
https://allafrica.com/stories/201903060028.html
LITHUANIA’S MONEY LAUNDERING PROBLEM
A blog post from Transparency International on 5 March comments on the recent several banking scandals affecting the country, in the light of the latest – the so-called Troika Laundromat. It says that the findings of the OCCRP investigation raises questions as to whether AML supervision in Lithuania is fit for purpose. It concludes by saying that Lithuania’s reputation has been tainted because of the Swedbank and ŪKIO revelations, and now Lithuania’s financial sector needs to work hard to regain trust from citizens, customers and partners, sending a strong signal that dirty money is not welcome.
https://voices.transparency.org/lithuanias-money-laundering-problem-c3b3ebba1618
PAKISTAN TO FREEZE ASSETS OF UN-SANCTIONED ARMED GROUPS
Al Jazeera on 5 March reported that a new regulation formalises process for seizure of assets of any armed group or individual, including Jaish-e-Muhammad. The objective of the UNSC (Freezing and Seizure) Order 2019 is said to be to streamline the procedure for implementation of Security Council Sanctions against designated individuals and entities. The passing of the regulation by Pakistan comes as the country has come under increasing pressure from FATF.
RECENT AMENDMENTS TO THE AML/CFT LAWS IN MAURITIUS
BLC Robert on 6 March published an article on improvements to AML/CFT laws in Mauritius, including to bring the legislation in line with the recommendations made in the ESAAMLG Mutual Evaluation Report for Mauritius 2018. After providing details of some important elements of the developments, it notes that when the EU Commission adopted its list of 23 high-risk third countries with strategic deficiencies in their AML/CFT frameworks Mauritius was not on the list of the high-risk third countries.
https://www.blc.mu/blc.mu1/view_news.php?id=41
PARAGUAYAN MONEY MAN IN MONEY LAUNDERING CASES FACES EXTRADITION TO US
The Miami Herald on 5 March carried a story about money laundering originating in the so-called Tri-Border Area of Paraguay, Argentina and Brazil, where Ciudad del Este is renowned for selling everything from counterfeit electronics products to contraband cigarettes at steep discounts with low taxes. It says that US authorities have been developing several money-laundering cases targeting the flow of billions through the Paraguayan hub, for Latin American drug profits, knockoff consumer goods and terrorist fund-raising. A Lebanese businessman who owns a major money-exchange business in Ciudad del Este is expected to be extradited to Miami and eventually New York. Nader Mohamad Farhat is perhaps the biggest Tri-Border Area catch yet for the feds. He was arrested last year by Paraguayan officials and DEA in Paraguay.
https://www.miamiherald.com/news/local/article226938854.html
INDIA: 14 EX-DIRECTORS OF FINANCIAL SERVICES FIRM FACE MONEY LAUNDERING CHARGES
The Hindu reported on 5 March reported that, following an audit by Grant Thornton, the new government-appointed board of IL&FS has charged 14 former directors of group firm IL&FS Financial Services Ltd (IFIN) of facilitating money laundering, sanctioning loans in violation of rules and causing “huge financial stress and losses” to the company. The audit report had found serious lapses in the manner in which huge loans were extended to certain entities even after internal risk assessment clearly showed that the borrowers were under financial stress.
3 PORT OF ROTTERDAM CUSTOMS OFFICERS ARRESTED FOR MONEY LAUNDERING
NL Times on 5 March reported that they fell under suspicion because they made striking cash withdrawals and deposits on their bank accounts. According to the Public Prosecutor, these amounts were not in proportion with their legal income as customs officers.
https://nltimes.nl/2019/03/05/three-rotterdam-customs-officers-arrested-money-laundering
MALTA LAUNCHES 2019 GUIDELINES FOR THE VAT TREATMENT OF HIRING OF PLEASURE YACHTS
KPMG on 5 March reported that, following a temporary suspension period last year, the guidelines for the VAT treatment of hiring of Pleasure Yachts have been recently published just in time for the kick-off to the Summer Yachting Season 2019. The new Guidelines are said to reflect recent EU developments and best market practices.
https://www.lexology.com/library/document.ashx?g=7535be37-d8fd-429c-bfd6-6bff6a253478
ELIMINATING FORCED LABOUR FROM YOUR COMPANY’S SUPPLY CHAINS
On 4 March, K&L Gates published a briefing outlining lessons learned from 2018 and the trends developing for 2019.
ADIDAS EXECUTIVE SENTENCED IN US COLLEGE BASKETBALL BRIBERY CASE
On 6 March, the Wall Street Journal reported that Jim Gatto, who served as Adidas’s director of global sports marketing for basketball, had been sentenced to 9 months in prison for his role in a scheme to bribe families of top-ranked high-school basketball players to induce them to attend Adidas-sponsored universities, following a trial that detailed the corrupting role of money in college athletics.
PODCAST:THE FIRST 48 HOURS
In the latest TRACE podcast, Nathaniel Edmonds of Paul Hastings describes the key steps to take in the first 48 hours after you learn a bribe may have been paid.
https://traceinternational.org/bribe_swindle_or_steal
CANADA AGAIN WARNS CONSUMERS ABOUT FALSE LABELLING CLAIMS INVOLVING TEXTILES ALLEGEDLY MADE OF BAMBOO
HKTDC on 6 March reported that the Canada Competition Bureau is again warning consumers about false labelling claims involving textile and apparel products allegedly made of bamboo. This issue has been a long-standing concern for both the Canada Competition Bureau and the US Federal Trade Commission.
UK: NEW COUNTER-TERRORISM INFORMATION-SHARING PLATFORM ANNOUNCED
On 6 March, the Home Office issued a news release saying that a new multi-million pound project to share information with the private sector has been announced by the Security Minister. It aims to enhance collaboration between business, industry and the public sector has been announced. The £10 million project is being funded by Pool Re, the terrorism reinsurer, and led by Counter Terrorism Policing, in partnership with the Joint Security and Resilience Centre, part of the Home Office.
https://www.gov.uk/government/news/new-counter-terrorism-information-sharing-platform-announced
UK TAX STATISTICS: AN OVERVIEW
On 6 March, the House of Commons Library published a briefing paper that provides an overview of tax statistics, including recent trends, forecasts, and distribution of taxpayers.
https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-8513
INTERNATIONAL CRICKET COUNCIL BANS FORMER ZIMBABWE OFFICIAL FOR 10 YEARS
On 6 March, former Zimbabwe Cricket director Enock Ikope has been banned for 10 years by the International Cricket Council for breaching 3 counts of ICC’s anti-corruption code. He was the second official from the Harare Metropolitan Cricket Association to be penalised by the ICC after Rajan Nayer was banned from all cricket activities for 20 years
https://www.voazimbabwe.com/a/icc-bans-former-zimbabwe-official-ikope-for-10-years/4816333.html
THE MAJOR SCANDAL ENGULFING CANADIAN PRIME MINISTER JUSTIN TRUDEAU, EXPLAINED
Vox on 6 March published this article which sets out to explain the reasons behind the pressure on Trudeau.
https://www.vox.com/2019/3/6/18249949/trudeau-canada-snc-lavalin-scandal-wilson-raybould
NEW EU RULES ON FOREIGN INVESTMENTS: ALL YOU NEED TO KNOW ABOUT THE NEW SCREENING MECHANISM
On 6 March, Orrick Herrington and Sutcliffe published a briefing which seeks to set out the main features of the relevant EU Regulation by which, for the first time, the EU is equipping itself with a comprehensive framework to monitor investments into EU businesses by investors from outside the EU.
https://www.jdsupra.com/legalnews/new-eu-rules-on-foreign-investments-all-97166/
DEVELOPMENTS RELATING TO YACHT LEASING MODELS IN MALTA
On 6 March, Superyacht News published an article in which pertinent developments in the application of new leasing models in Malta were outlined. This is as the Maltese authorities published new, much-anticipated Guidelines, which outline the manner in which the place of supply of yachts is to be taxed. These Guidelines apply to leases commencing on or after the 1 November 2018 and pave the way for the application of new leasing models offering owners and lessees concrete workable solutions.
http://www.superyachtnews.com/business/developments-relating-to-yacht-leasing-models-in-malta
LEGAL ADVICE PRIVILEGE CLAIMS SUBJECT TO “DOMINANT PURPOSE” TEST
On 5 March, an article from Allen & Overy was concerned with a recent UK High Court case, involving judicial review proceedings where it was stated that claims for legal advice privilege were said to be subject to a dominant purpose test, namely whether the communication or document was brought into existence with the dominant purpose of it or its contents being used to obtain legal advice.
EX-EXECUTIVE OF NATIONAL AUSTRALIA BANK CHARGED WITH 56 COUNTS OF FRAUD
Baker McKenzie on 6 March reported on Rosemary Rogers, a former senior executive of National Australia Bank Ltd, who has been charged in connection with wide-ranging fraud that police said netted her more than A$5 million ($3.5 million) from inflated contracts charged to the bank.
http://www.riskandcompliancehub.com/ex-executive-of-australias-nab-charged-with-56-counts-of-fraud/
US MAILING SYSTEM KEY TO FUTURE FENTANYL TRAFFICKING PREVENTION
Insight Crime on 6 March carried an article saying that the US mailing system is quickly emerging as the key ingredient in the fight against the dangerous synthetic opioid. Ports of entry along the south-west border of the United States and the US mailing system are 2 of the most significant fentanyl trafficking routes.
ECUADOR ARMS TRAFFICKING RING MORE COMPLEX THAN PREVIOUSLY THOUGHT
An article on Insight Crime on 6 March was concerned with the dismantling by Ecuadorean authorities of an international arms trafficking network that transported, stored and distributed weapons and ammunition from Peru into Ecuador, as well as along Ecuador’s border with Colombia. They raided several warehouses, arrested 7 people, seized 500,000 rounds of ammunition and other explosives seemingly bound for Colombia’s black market. In the last 9 years, Ecuador’s police have seized around 40,000 smuggled weapons, including 12,000 high-calibre rifles, which were all bound for criminal organisations.
https://www.insightcrime.org/news/analysis/ecuador-arms-trafficking-ring-peru-colombia/
POLICE FIND £465,000 IN CASH IN BACK OF VAN IN LEICESTER AS MAN ARRESTED
MSN reported on 6 March that a driver was arrested after up to £465,000 in banknotes was found in the back of a van. Leicestershire’s Roads Policing Unit tweeted pictures of the substantial haul after the vehicle was pulled over in Leicester.
https://www.birminghammail.co.uk/news/midlands-news/police-find-465000-cash-back-15930842
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