22nd March 2019
US JUDGE EXTENDS BAN ON PUBLICATION OF 3D PRINTED GUN BLUEPRINTS
The Osburn Oracle on 21st March reported that a US federal judge extended a ban on publishing blueprints for 3D printed guns online, issuing an injunction against Texas-based Defense Distributed. 19 states and Washington, DC are seeking to block it from making technical plans for an array of guns available globally on the internet.
EUROPEAN ANTIQUES MARKET THREATENED BY NEW REGULATION
On 21st March, Collyer Bristow published an article saying that the European Parliament plenary session adopted its position at 1st reading of a draft EU Regulation on the import of cultural goods from outside the EU. The Regulation is currently expected to come into full effect sometime between 2024 and 2026. The idea behind the Regulation is to combat the trafficking of cultural goods to finance terrorism. Anyone wishing to import an item will need to apply to the country of import for the grant an import licence. Member States can only grant an import licence if they are certain that the exportation of the item from its country of origin was legal, and it will be for the applicant to prove that the exportation was legal. The article says that there is likely to be a substantial impact on the EU antiques market. Although the Regulation does make provisions for temporary licences in relation to antiques fairs, the trader will need to apply for a further licence before they can release the object to the buyer; and a buyer will be unlikely to risk buying an object when the legality of its origin cannot be guaranteed. Currently, there are no licensing requirements for the importation of items of cultural interest to the UK (although there are laws dealing with such items illegally removed from their country of origin).
HUMAN EMBRYO SMUGGLING IN INDIA
On 22nd March, the FIT website reported that a recent case involving a Malaysian man bringing live human embryo into India has highlighted the vagueness of laws in India over assisted reproductive technology (ART). Officials say the embryo was on its way to a clinic in Mumbai. India has banned such imports, except for research purposes, and not for surrogacy – which is believed to be the reason for this import.
BULGARIA: INTERNATIONAL INVESTMENT BANK DENIES RUSSIAN SECRET SERVICE TIES
On 21st March, the Budapest Business Journal reported that the management board of the International Investment Bank (IIB), which recently announced it will move its headquarters from Moscow to Budapest, has released a statement denying what it says are “unfounded” media accusations of close ties to the Russian secret service and state. IIB has 9 members: Russia, Bulgaria, Hungary, the Czech Republic, Romania, Slovakia, Cuba, Mongolia, and Vietnam. The bank’s top 3 shareholders by paid-in capital are Russia, Bulgaria, and Hungary. However, a commentary from the European Council on Foreign Relations notes that the IIB is registered among the official state organs and governing bodies of the Russian Federation.
(ANOTHER) BRAZILIAN EX-PRESIDENT ARRESTED IN SWEEPING ANTI-CORRUPTION PROBE
NPR on 21st March reported that former Brazilian President Michel Temer – who left office less than 3 months ago – was arrested in Sao Paulo as part of a sweeping anti-corruption investigation. He is the second former president to be arrested in the ongoing “Operation Car Wash”. Former President Luiz Inacio Lula da Silva was convicted of corruption and money laundering in 2017.
MALTA HAS MADE NO SIGNIFICANT PROGRESS IN THE FIGHT AGAINST CORRUPTION’ – EUROPEAN COMMISSION
On 21st March, the Times of Malta reported that the European Commission has said that Malta has not made any significant progress in the fight against corruption. During a presentation about the Malta 2019 country report, European Commission Deputy Secretary General Céline Gauer said more work needed to be done for the strengthening of governance frameworks and the enforcement of AML measures. She did note that there had been significant improvements in the staffing levels of supervisory authorities in the financial sector, and that Malta had made limited progress in general when it came to implementing the 2018 country-specific recommendations.
DENMARK: WOMAN CHARGED WITH LAUNDERING OVER 100 MILLION KRONER
On 21st March, the CPH Post reported that the Danish state prosecutor for economic and international crime (SØIK), has just announce that a 45-year-old woman has been remanded in custody charged with laundering around 105 million kroner. It says that changes in the law that came into effect in July 2018 laid the foundation for the charges, and the woman holds the somewhat dubious honour of being the first person to be charged under the new legal regime. As well as money laundering, the woman has been charged with attempting to sell stolen goods for over 100 million kroner. 2 other men involved in the case have been released after being charged.
TRUST COMPANY DIRECTORS LINKED TO BRIBERY OF ST MAARTEN POLITICIAN
The Daily Herald in St Maarten reported on 21st March a case involving crimes that were allegedly committed in Dutch St. Maarten, French St. Martin, the Netherlands, Spain, St. Kitts and Nevis, Anguilla, the Isle of Man and Panama between January 1997 and August 23, 2018. The defendants are STC Administration and Management Service NV and Foundation Escrow STC’s directors who are charged in connection with activities linked to a consultant from the Netherlands who is suspected of money laundering, bribery of government officials and failure to file taxes – and who was arrested in the Netherlands in connection with the investigation into corruption, money-laundering and the payment and acceptance of bribes in the construction sector in St. Maarten. The trust office directors allegedly committed these crimes at STC Administration and its legal predecessor, Standard Trust Company NV, between January 2008, and August 2017. Among the transactions were those made in July and August 2011 which concerned 2 payments from Caribbean Advice and Consultancy (CAC) Ltd in the Isle of Man to Caribbean Real Estate/Re/Max in Anguilla for the purchase of property, allegedly on behalf of St. Maarten politician Theodore Heyliger.
CITIGROUP TO SELL VENEZUELAN GOLD
KYC 360 on 22nd March reported that Citigroup Inc plans to sell several tons of gold placed as collateral by Venezuela’s central bank on a $1.6 billion loan after the deadline for repurchasing them expired, sources said, a setback for President Nicolas Maduro’s efforts to hold onto the country’s fast-shrinking reserves.
FIFA GIVES LIFE BAN TO ECUADOR OFFICIAL FOR BRIBERY
On 22nd March, KYC 360 reported that the FIFA ethics committee has given a life ban to Luis Chiriboga, a former Ecuador soccer federation president who took bribes linked to the Copa America and Copa Libertadores.
TRANSPORT GOODS OUT OF THE UK BY ROAD IF THE UK LEAVES THE EU WITHOUT A DEAL: CHECKLIST FOR HAULIERS
On 21st March, HMRC published a news release containing a checklist of documents that haulage drivers must carry to pass through customs if the UK leaves the EU without a deal.
DoJ EASES STANCE ON USE OF “DISAPPEARING” MESSAGE PLATFORMS IN CORPORATE ENFORCEMENT POLICY STATEMENT
On 21st March, Greenberg Traurig issued an Alert saying that the DoJ has eliminated a policy that some interpreted as requiring companies to internally ban common disappearing message platforms. It says that, historically, many banks have prohibited the use of disappearing message platforms, but the change to DoJ policy now permits companies to use such platforms to the extent the companies comply with certain conditions.
MEXICO TO TEST E-MANIFEST FOR BONDED FACILITY ARRIVALS BY AIR
Baker McKenzie on 18th March reported that the Mexico’s Tax Administration (SAT), which oversees the Customs Service, said that from March 11th it will test the electronic transmission of air cargo manifests via VUCEM (the single window) for goods entering bonded facilities.
THE 2010 BEIJING CONVENTION AND PROTOCOL: NEW TOOLS TO ADDRESS NEW THREATS TO CIVIL AVIATION SECURITY – LITTLE ADOPTED TO DATE
In its Aviation Newsletter for February, Clyde & Co includes an article saying that since the Tokyo Convention of 1963 the international community has worked to allow for criminal acts affecting civil aviation security to be criminally punished everywhere in the world and to allow for those responsible to be prosecuted. It then says that a additional step has been accomplished towards the unification and strengthening of civil aviation security with the entry into force in July 2018 of the Beijing Convention and Protocol – the Convention on the Suppression of Unlawful Acts relating to Civil Aviation and of the Protocol Supplementary to the Convention for the Suppression of Unlawful Seizure of Aircraft. These followed the 9/11 attacks, when it was found that the existing legal framework of international instruments relating to terrorism and in particular to the potential use of aircraft as weapons needed to be improved and updated in order to take into consideration the new threat to aviation security and to allow a more effective means of prevention. The Beijing Convention expands the list of criminal offences already contained in the previous international treaties and expands their scope, and it provides that these (listed in the article) shall be criminal offences, punishable by severe penalties. The Convention also the criminalises the attempt to commit an offence, allows for accomplice liability and conspiracy, and is not limited to persons on board of the aircraft, but includes as authors persons on the ground who participated in the commission of the offence as well as legal entities. The Protocol expands the scope of the hijacking offence, which is no longer limited to hijackings that occur in flight but, now includes pre- or post-flight. It also adds the same ancillary offences, such as attempt to commit, accomplice liability etc. Both extend the circumstances to the list of those already contained in the Montreal Convention in which a State Party may establish its jurisdiction over an offence. Both still contain the same principle as in previous treaties: prosecute or extradite, and none of the offences defined can be considered as a political offence. However, to date, the Beijing Convention has been ratified by only 16 States and the Beijing Protocol by only 15 States. The article says that if the Convention and Protocol fails to attract more contracting States, the Beijing legal regime will remain theoretical. It points out that while France has ratified both Beijing treaties, the US, the UK, the Russian Federation and many others have not.
ADMITTING TAX FRAUD TO HMRC USING THE CONTRACTUAL DISCLOSURE FACILITY
On 22nd March, a news release from HMRC containing updated information that explains that if HMRC suspects you of committing tax fraud, and will offer you a contract though the Contractual Disclosure Facility (CDF). It also explains what to do if you want to own up voluntarily to committing fraud. CDF is only suitable for people who want to admit to tax fraud. It is not for people who want to tell HMRC about errors, mistakes or avoidance schemes where there is not fraud. The CDF is for individuals only, this disclosure facility is not suitable for companies.
US ACCUSES 2 RUSSIAN PORTS OF VIOLATING SANCTIONS AGAINST NORTH KOREA
UA Wire in Ukraine on 22nd March reported that OFAC suspects 2 Russian ports in Vladivostok and Nakhodka of violating the UN sanctions regime against North Korea. According to the US Treasury, vessels that participated in the transshipment of oil and coal to North Korean tankers visited Vladivostok and Nakhodka ports; and, in addition to the Russian ports, this scheme also involved 4 ports in China, 4 in Taiwan, 3 in South Korea and a port in Malaysia. In addition, more than 60 vessels appeared in the lists of violators of the sanctions regime against North Korea and, on March 21st, 18 more ships from different countries were added to the list.
UK FOOD CRIME UNIT PLEDGES TOUGHER ACTION ON FOOD FRAUD
The BBC on 22nd March reported that the National Food Crime Unit’s new chief, Darren Davies, wants to see firms that fraudulently use cheaper substitutes criminally prosecuted. It says that food fraud rarely makes the news – the last major one was the 2013 horsemeat scandal, though olive oil and coffee are also identified as prone to substitution. Fish, grains, honey, coffee, tea, spices, wine, certain fruit juices, milk and meat are the mostly commonly subject to fraud, according to a list drawn up by the EU. While the risk to health is the most serious issue, there are also significant financial costs associated with food fraud. Research carried out last year by NFU Mutual suggested that it costs the UK food and drink industry up to £12 billion a year.
VIETNAM JAILS FORMER VIETSOVPETRO OIL JOINT VENTURE OFFICIALS IN GRAFT CRACKDOWN
Reuters on 22nd March reported that a court in Vietnam has jailed 2 former officials of a Vietnam-Russia oil joint venture, after convicting them of abusing their power to appropriate property. Vietnam has launched investigations into hundreds of public officials and jail several executives at state-owned enterprises.
SCRAP METAL COMPANY TOPS UK TAX DEFAULTER LIST OWING £16.4 MILLION
Accountancy Daily on 22nd March reported on the recently released tax defaulters list from HMRC. HMRC’s latest list of major tax defaulters is topped by a scrap metal company, JKL Ltd, owing £16.4 million on £22.9 million unpaid tax, followed by a restaurant owing £626,461, with a raft of takeaways and construction services also featuring.
IRELAND’S GAMBLING MARKET TO GET A NEW REGULATORY WATCHDOG EVENTUALLY
On 22nd March, Calvin Ayre reported that Ireland’s gambling market will get a new regulatory watchdog, although the new body won’t be in place until late-2020 at the earliest. Ireland’s government has voted in favour of establishing a new gambling regulatory authority, which will be tasked with overseeing all gambling activity in the Republic, including online betting, via the issuing of licences and the imposing of penalties on operators who fail to toe the line.
PHILIPPINES: USED CLOTHING (UKAY-UKAY) SMUGGLING
On 22nd March, Manila Bulletin reported that around 60 bundles of used clothing or ukay-ukay were discovered in a ship that docked at the Port of Cagayan de Oro, the Philippine Coast Guard said. The law bans the importation of textile articles commonly known as used clothing.
UK: BRIBERY ACT SHINES WHILST AML SUPERVISION STRUGGLES
Another interesting ang timely article from Corker Bining on 22nd March saying that reports on the Bribery Act 2010 and the Office for Professional Body Anti-Money Laundering Supervision (OPBAS) have given contrasting assessments of the performance of two keystones in the fight against financial crime and corruption. On the Bribery Act, it notes that only minor issues were flagged on the law and related guidance, with suggestions that SME should be given more assistance on ‘adequate procedures’ to prevent bribery and with conducting business in foreign jurisdictions, although stopping short of suggesting that low-level ‘facilitation payments’ commonly encountered overseas should be exempt from criminal liability. However, investigators were criticised, with a recommendation that the City of London Police’s anti-bribery training programme be expanded to forces across the country and that the SFO and DPP publish reports on speeding up bribery investigations and improving communication with suspects. The Parliamentary Committee stopped short of endorsing a broader ‘failure to prevent’ offence. The OPBAS report on themes arising from its 2018 AML supervisory assessments painted a less enthusiastic picture.
NORWAY FSA FOUND INSUFFICIENT AML ASSESSMENTS AT BANKS
Reuters on 22nd March reported that several banks operating in Norway made insufficient AML risk assessments last year, the country’s Financial Supervisory Authority (FSA) said in its annual report.
WHY MONEY LAUNDERING MATTERS FOR ESTATE AGENTS
An article in The Negotiator on 22nd March looks at the social and economic damage that serious and organised crime inflicts on the UK and why this makes it so important that estate agents engage in the battle to prevent money laundering. It says that for estate agents who are battling to reach sales targets and rushing about to attend viewings, helping the nation combat crime could seem like a remote prospect – but says that they do have a part to play. It includes a short case study where the scam was given legitimacy because the solicitor and estate agent involved were persuaded that the fraudster was the real owner of the property and were engaged to help ‘sell’ the property.