“RETAINED EU LAW” – A PRACTICAL GUIDE

On 5 March, Gowling WLG published a briefing on this term and what it means.  “Retained EU law” is a legal term introduced into UK law under the European Union (Withdrawal) Act 2018 (and also used in Isle of Man law too). It captures EU-derived rights and legislation the government intends to retain and preserve in UK law for legal continuity after Brexit. There is no specific list of retained EU law for lawyers to refer to – it is a matter of statutory interpretation.

https://gowlingwlg.com/en/insights-resources/articles/2019/retained-eu-law-a-practical-guide/

ANDRII PETROVYCH KLIUIEV REMOVED FROM UK UKRAINE SANCTIONS LISTS

A Notice from HM Treasury on 5 March said that, following EU Regulation 2019/352, Andrii Petrovych KLIUIEV has been removed from the list of those subject to sanctions in connections with the Ukraine misappropriation and human rights sanctions.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/783691/Notice_Ukraine__Misappropriation__2019_352.pdf

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2019.064.01.0001.01.ENG&toc=OJ:L:2019:064:TOC

 

OTHER THINGS YOU MAY HAVE MISSED – MARCH 4

March 4 2019

TEMPORARY BLOCK ON US FIREARMS EXPORT CHANGE

Roll Call on 28 February reported that a temporary block had been placed on a Trump administration proposal to switch oversight authority of firearm sales abroad from the State Department to the Commerce Department, it being argued that the move would significantly weaken congressional oversight and increase the risk of terrorists and criminals getting their hands on powerful military-grade weapons.   The rule change would take firearms off the Munitions List and place them on the Commerce Control List, where they would be subject to much less congressional oversight including the pre-sale notification requirements contained in the export control law. It is also claimed that the Commerce Department is not required to notify Congress, as the State Department is required, when there is evidence that US defence exports have been misused.

https://www.rollcall.com/news/congress/menendez-blocks-firearm-export-rule-citing-oversight-concerns

https://www.armscontrol.org/act/2019-03/news/us-firearms-export-changes-meet-challenges

LUGGAGE CAN BE UNLOCKED USING 3D PRINTED COPIES OF TSA MASTER KEYS

Homeland Security Today reported on 28 February that, using a key printed on a 3D printer, investigators discovered that they could potentially open the luggage locks of almost any bag in the world.  It cites a Which report that says that more than 4 years ago, the master keys for luggage locks fitted to the majority of suitcases and cabin bags were leaked, yet the US Transportation Security Administration (TSA) continues to advise travellers to only use its approved locks.

https://www.which.co.uk/news/2019/02/master-key-to-luggage-locks-leaked-thieves-can-open-your-suitcase-with-a-3d-printed-key/

EMBEZZLEMENT IN UKRAINE’S ARMY: UKROBORONPROM DIRECTORS DETAINED

112 UA reported on 4 March that investigators of the National Anti-Corruption Bureau and Specialized Anti-Corruption Prosecutor’s Office detained the acting and former directors of the State Foreign Trade Enterprise SpetsTechnoExport on suspicion of embezzling $2,225 million.  

https://112.international/ukraine-top-news/embezzlement-in-ukraines-army-ukroboronprom-directors-detained-37537.html

https://www.rferl.org/a/poroshenko-fires-close-ally-amid-smuggling-scandal/29802411.html

ART WORLD SCRAMBLES TO SHIP ART BEFORE BREXIT DEADLINE

The Art Newspaper on 4 March reported that British institutions and galleries are rushing to ship works to and from the EU before the Brexit deadline of 29 March as uncertainty mounts over the free movement of goods in the event of a no-deal scenario.

https://www.theartnewspaper.com/news/scramble-to-ship-before-brexit

UK: MINISTERS POSTPONE BILL DEBATE TO AVOID LIKELY DEFEAT OVER BENEFICIAL OWNERSHIP REGISTERS FOR CROWN DEPENDENCIES

The Guardian and others on 4 March reported that Ministers have pulled a financial services Bill from the House of Commons, fearing the government was almost certain to be defeated on an amendment requiring Jersey, Guernsey and the Isle of Man to clamp down on money laundering by having public beneficial ownership registers.  The Conservative MP Andrew Mitchell and Labour’s Margaret Hodge want the crown dependencies to introduce public share ownership records by December 2020, which the territories resist.

https://www.theguardian.com/politics/2019/mar/04/house-of-commons-financial-services-bill-debate-pulled-crown-dependencies

The House of Commons Library has produced a briefing paper on the Bill –

https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-8493

MEPs HAVE CALLED FOR THE CREATION OF A NEW EU AML WATCHDOG AND A EUROPEAN FINANCIAL POLICE FORCE

On 4 March, the EU Parliament website reported that both recommendations are included in a set of recommendations approved by Parliament’s special tax committee.  The package was described as a “detailed roadmap towards fairer and more effective taxation and tackling financial crimes.”

https://www.theparliamentmagazine.eu/articles/news/meps-call-creation-anti-money-laundering-watchdog

PHILIPPINES: GOVERNMENT CRACKS DOWN ON CIGARETTE SMUGGLING, COUNTERFEITING

Philstar on March 4 published a special report saying that the illicit trading of cigarettes has become rampant in the Philippines and from smuggling cigarettes to using fake tax stamps, the practice has evolved into sneaking unregistered cigarette-making machines into the country, with small factories producing fake cigarettes bearing famous brands.

https://www.philstar.com/headlines/2019/03/04/1898507/special-report-government-cracks-down-cigarette-smuggling-counterfeiting

US THREAT LOOMS OVER FOREIGN FIRMS TRADING WITH CUBA

EurActiv on 4 March reported that the Trump administration is brandishing the threat of sanctions against foreign companies “trafficking” with Cuba, a move hitherto mothballed by Washington so as not to offend allies. The White House has broken with 2 decades of precedent in threatening to activate Title III of the Helms-Burton Act, which extended the US embargo to apply to foreign companies trading with Cuba.  The EU is the largest investor in Cuba. Although the Helms-Burton Act was signed in 1996, Title III was been systematically suspended every 6 months to prevent discord between the US and key partners, including the EU.  But that may come to an end as earlier this year, Trump fixed a 45-day suspension from 1 February 1 that expires on 17 March.

https://www.euractiv.com/section/global-europe/news/us-threat-looms-over-foreign-firms-trading-with-cuba/

UK: THE HOLOCAUST (RETURN OF CULTURAL OBJECTS)(AMENDMENT) BILL 2017-19

On 4 March, the House of Commons Library published a briefing paper prepared for the remaining stages of the Holocaust (Return of Cultural Objects) (Amendment) Bill 2017-19.  It is a Private Members’ Bill, introduced by Theresa Villiers and supported by the Government. The Bill has 2 clauses and would prevent the Holocaust (Return of Cultural Objects) Act 2009 from expiring on 11 November.

https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-8409

REGISTERS OF BENEFICIAL OWNERSHIP

On 4 March, the House of Commons Library issued a briefing paper that  looks at the development of beneficial ownership registers in the UK and around the world.

https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-8259

CANADA: IN MAJOR BLOW TO TRUDEAU, SENIOR MINISTER QUITS OVER CORRUPTION ALLEGATIONS

Zero Hedge on 3 March reported that Jane Philpott had resigned as president of the Treasury board as fallout from the SNC-Lavalin/Gadhafi scandal.

https://www.zerohedge.com/news/2019-03-04/major-blow-trudeau-senior-minister-quits-over-corruption-allegations

HAITIAN INSURANCE COMPANY DENOUNCED FOR CORRUPTION

Prensa Latina on 4 March reported that union members of the Office of Insurance against Accidents at Work, Illnesses and Maternity (Ofatma) denounced acts of corruption in the entity and accused its director of misappropriation of funds.

https://www.plenglish.com/index.php?o=rn&id=39418&SEO=haitian-insurance-company-denounced-for-corruption

BREXIT: VAT RECOVERY FOR FINANCIAL SERVICES EXPORTS IN A NO-DEAL SCENARIO

On 4 March, HM Treasury issued a news release saying that the Government will allow companies to reclaim VAT on supplies of certain financial services made to the EU 27 in the event that the UK withdraws from the EU with no deal.

https://www.gov.uk/government/news/vat-recovery-for-financial-services-exports-in-a-no-deal-scenario

BREXIT AND THE UK TRADE IN ROUGH DIAMONDS

On 4 Mcrh, the FCO issued a news release which provided guidance and information about what you may need to do to prepare for trading internationally in rough diamonds once the UK has left the EU.

https://www.gov.uk/government/publications/brexit-and-the-uk-trade-in-rough-diamonds

RUSSIAN CUSTOMS SEIZE 129.1 KG OF PERFUME AND COSMETICS BOUND FOR NORTH KOREA

NK News on 4 March reported that the authorities in Khasan on the Russian-DPRK border seized a shipment of 129.1 kg of “perfumery and cosmetics” before it could be brought into North Korea, the press service of Ussuriysk Customs said in a statement.  This followed a routine inspection on board the passenger car of a train.  The cache was said to consist of 634 packs of L’Oréal-branded hand cream and make-up remover, as well as eau de toilette and perfume manufactured by Russian-made Lakes Coast, Sigare Corona Paris, and La Cote Parfum brands, worth almost $2,631.

https://www.nknews.org/2019/03/russian-customs-seize-129-1-kg-of-perfume-and-cosmetics-bound-for-north-korea/

FORMER PRESIDENTS INDICTED FOR MONEY LAUNDERING IN EL SALVADOR

Baker McKenzie reported on 4 March that former El Salvador President Elias Antonio Saca is once-again being accused of financial irregularities, stemming from a US$10 million Taiwan grant provided to the country.  The Prosecutor’s Office announced it would proceed with indictments against the jailed former president, along with deceased former President Francisco Flores, exiled former President Mauricio Funes, banker Mauricio Samayoa, and 2 of Saca’s collaborators, Gerardo Balzaretti, and Juan Tennant Wright.

http://www.riskandcompliancehub.com/former-presidents-indicted-for-money-laundering-in-el-salvador/

MAN JAILED FOR FAILURE TO DISCLOSE DIVERTED ASSETS TO FCA

A news release on Mondo Visione on 4 March reports that the High Court had sentenced Robert John McKendrick to 6 months imprisonment for contempt of court.  He had diverted funds and failed to disclose information about his assets in breach of freezing injunctions obtained by the FCA. The FCA had launched legal action in July 2013 in respect of 4 unauthorised collective investment schemes promoted mainly by Capital Alternatives re rice farm harvests in Sierra Leone and reforestation projects.  One of the consequences was a freezing order requiring Mr McKendrick to disclose all his assets and preventing him from disposing of them.

http://www.mondovisione.com/media-and-resources/news/uk-financial-conduct-authority-takes-action-for-contempt-of-court/

BORDER OFFICERS AT CAIRO AIRPORT DISCOVER MUMMIFIED HUMAN REMAINS IN HOLLOWED OUT LOUDSPEAKERS

Illicit Trade on 4 March reported that, after inspecting the speakers destined for Belgium, which had been hollowed out to accommodate the remains, investigators were able to identify 6 separate body parts belonging to 2 mummies, including feet, hands and parts of a torso.

https://www.illicit-trade.com/2019/03/border-officers-at-cairo-airport-discover-mummified-human-remains-in-hollowed-out-loudspeakers/?utm_source=dlvr.it&utm_medium=twitter

CLAIM THAT LEGAL AND ILLICIT TOBACCO TRADE INTERMINGLED IN SOUTH AMERICA

An article on Illicit Trade on 4 March is concerned with a study into the illicit tobacco trade in South America; which is said to give a clear picture of how legal and illegal are intertwined as long as tobacco products are involved.

https://www.illicit-trade.com/2019/03/illicit-trade-tobacco-south-america/

US SANCTIONS LAWS: DANGERS AHEAD FOR FOREIGN COMPANIES

William Mullen in the US has published a 2-part article which starts by saying that many foreign companies ask how the US Government can extend the long arm of its jurisdiction around the world – yet the incidence of US sanctions on non-US parties is increasing; and the laws create a growing legal risk for foreign companies and financial institutions – often without their even knowing it.  The articles provide a more detailed discussion of the US sanctions laws for non-US companies and steps they can take to reduce these risks.

https://www.jdsupra.com/legalnews/u-s-sanctions-laws-dangers-ahead-for-74463/

https://www.jdsupra.com/legalnews/u-s-sanctions-laws-dangers-ahead-for-18252/

MONEY LAUNDERING IN CAPITAL MARKETS

On 4 March, RUSI published a Commentary saying that the UK’s FCA has promised action to address the UK capital markets’ vulnerability to high-end money laundering – and saying that it faces a difficult task.  One problem highlighted in the UK National Risk Assessment was that capital markets have relatively weak compliance controls and low levels of suspicious transactions reporting; and the ‘intelligence gap’ around the scale and nature of money laundering in capital markets does not help matters.  The article mentions other, technical difficulties and says that whilst the FCA expects to publish the outcome of its diagnostic investigations into money laundering in capital markets in June 2019, in the meantime it is treading softly.

https://rusi.org/commentary/securing-securities-money-laundering-capital-markets

UK: ESTATE AGENTS TARGETED IN MONEY LAUNDERING CRACKDOWN

On 4 March, HMRC reported that estate agents have been hit with unannounced inspections as part of a week-long crackdown on money laundering in the property industry.  HMRC officers visited 50 estate agents across England after they were suspected of trading without being registered as required under money laundering regulations. The visits came as HMRC published the latest businesses hit with fines for failing to comply with the regulations. This includes estate agent Countrywide Estate Agents receiving a £215,000 fine.

https://www.gov.uk/government/news/estate-agents-targeted-in-money-laundering-crackdown

“TROIKA LAUNDROMAT” – NEW LEAKED DOCUMENTS REVEALS LAUNDERING THROUGH LITHUANIA

On 4 March, OCCRP reported that politicians, criminals and members of the Russian elite, including President Vladimir Putin’s friend Sergey Roldugin (who is not accused of anything illegal), funneled billions of dollars through a hidden banking network.  1.3 million leaked banking records, and other documents, are said to reveal the $8.8 billion scheme. The investigation is named after the Russian private investment bank, Troika Dialog, that allegedly created and operated the scheme, using at least 35 bank accounts at Lithuanian bank, Ukio Bankas.  Documents indicate that the scheme, which ran for 8 years till 2013, combined criminal and legitimate money, making its sources difficult to trace.  Recipients of the transfers included Eastern European millionaires who used the cash to buy luxury European properties, yachts and sports tickets.

https://www.icij.org/blog/2019/03/troika-laundromat-reveals-russian-banks-8-8bn-offshore-scheme/

https://www.rferl.org/a/the-troika-laundromat-five-quick-takeaways/29803199.html

EU ADDS 7 NAMES TO SYRIA SANCTIONS LIST – UK FOLLOWS SUIT

On 4 March, both the EU and HM Treasury announced the adding of 7 names to their Syrian sanctions lists.  Those added are ministers in Syria – Major General Mohammad Khaled al-Rahmoun (Minister of Interior); Mohammad Rami Radwan Martini (Minister of Tourism); Imad Muwaffaq al-Azab (Minister of Education); Bassam Bashir Ibrahim (Minister of Higher Education); Suhail Mohammad Abdullatif (Minister of Public Works and Housing); Iyad Mohammad al-Khatib (Minister of Communications and Technology); and Mohammad Maen Zein-al-Abidin Jazba (Minister of Industry).

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/783436/Notice_Syria_2019_350.pdf

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.LI.2019.063.01.0001.01.ENG&toc=OJ:L:2019:063I:FULL

OTHER THINGS YOU MAY HAVE MISSED – MARCH 3

TAIWAN COAST GUARD INTERCEPTS 2 SHIPMENTS OF SMUGGLED MUSHROOMS

Focus Taiwan on 3 March reported that 2 shipments of mushrooms, believed to be from China, were seized by the Taiwanese Coast Guard.  The mushrooms, found in 60 boxes totalled 760 kg. A spokesman is quoted as saying that most substandard agricultural products from China do not go through any quality control process and therefore may contain toxic substances like lead, sulphur and arsenic, which can damage the human respiratory system, liver and kidneys.

http://focustaiwan.tw/news/asoc/201903030009.aspx

€2 MILLION FOR BOSNIA-HERZEGOVINA FOR MONEY LAUNDERING FIGHT

The Sarajevo Times on 3 March reported that the EU is funding a 3-year project worth €2 million, providing the State Investigation and Protection Agency (SIPA) with analytical software and computer hardware for the Anti-Money Laundering System (AMLS) and prepared a draft capacity development plan for the Financial Intelligence and the Unconstitutional Crime Units.

http://www.sarajevotimes.com/two-million-euros-for-fight-against-money-laundering/

UKRAINE: WHAT DOES ANNULMENT OF ILLEGAL ENRICHMENT LAW MEAN?

On 3 March, Hromadske International published an article saying that Ukraine’s National Anti-corruption Bureau (NABU) would have begun illegal enrichment cases against corrupt officials,but on February 26, the Constitutional Court ruled that relevant legislation was unconstitutional, and therefore null and void.  It says that, as a direct consequence of this decision, 65 cases against MPs, judges, prosecutors and other officials, who were all suspected of illegal enrichment to the combined amount of almost $19 million, have been closed. The article looks into the implications of, and reaction to, the decision.

https://en.hromadske.ua/posts/ukraine-legalizes-illegal-enrichment

NORWAY TOPS RULE OF LAW INDEX

The Nordic Page on 3 March reported that Norway is the second best country in the world in terms of rule of law, shows WJP Rule of Law Index® 2019. The US is in the 20th place of the list.  The WJP Rule of Law Index measures countries’ rule of law performance across 8 factors: Constraints on Government Powers, Absence of Corruption, Open Government, Fundamental Rights, Order and Security, Regulatory Enforcement, Civil Justice, and Criminal Justice.  It reports that In a sign suggesting rising authoritarianism, the factor score for “Constraints on Government Powers” declined in more countries than any other factor worldwide over the last year. The top 3 overall performers in the 2019 WJP Rule of Law Index were Denmark, Norway, and Finland; the bottom 3 were the Democratic Republic of the Congo, Cambodia, and Venezuela.

https://www.tnp.no/norway/panorama/norway-tops-rule-of-law-index

TAIWAN STUDYING J85 TURBOJET IN ORDER TO DEVELOP POWER PLANT FOR CRUISE MISSILE

The Alert 5 website reports that Taiwan plans to reverse-engineer the General Electric J85 small single-shaft turbojet aircraft engine so that it can develop a single-use power plant for its long-range cruise missile.   Unable to obtain new engines from General Electric, the National Chung-Shan Institute of Science and Technology (NCSIST) decided to focus on using the J85 from the country’s F-5 fighter aircraft.

http://alert5.com/2019/03/02/taiwan-studying-j85-turbojet-in-order-to-develop-power-plant-for-cruise-missile/

MAN PLEADS GUILTY TO RUNNING MULTIPLE DDOS-FOR-HIRE SERVICES THAT LAUNCHED MILLIONS OF ATTACKS OVER SEVERAL YEARS

The Krebbs on Security blog reported on 28 February that Sergiy P. Usatyuk  pleaded guilty to conspiracy to cause damage to Internet-connected computers and for his role in owning, administering and supporting illegal “booter” or “stresser” services designed to knock websites offline.  Usatyuk — aka Andrew Quez and Brian Martinez — admitted developing, controlling and operating the aforementioned booter services from around August 2015 through November 2017. The site says it interviewed him in 2014, when he was just 15.

https://krebsonsecurity.com/2019/02/booter-boss-interviewed-in-2014-pleads-guilty/

IRAN: 4 BANKS AND A NON-BANK FINANCIAL INSTITUTION BEING MERGED WILL NOW COMBINE WITH THE STATE-OWNED BANK SEPAH

On 3 March, Kenneth Rijock in his blog reported an announcement from the Central Bank of Iran. The institutions are named as the ANSAR BANK (aka ANSAR FINANCE AND CREDIT FUND) – said to be owned by IRGC;  HEKMAT IRANIAN BANK (aka BANK-E HEKMAT IRANIAN) – said to be owned by the army; BANK QAVAMIN (aka BANK GHAVAMIN); and BANK MEHR EGHTESAD (formerly MEHR FINANCE AND CREDIT UNION) – said to be owned by a security and paramilitary force.    

http://rijock.blogspot.com/2019/03/alert-on-curious-merger-of-iraniian.html