OTHER THINGS YOU MAY HAVE MISSED – APRIL 5

5th April 2019

NIGERIA: BIG-BUDGET PROGRAMMES TO HELP SMALL BUSINESSPEOPLE MORE OFTEN USED BY CORRUPT OFFICIALS TO HELP THEMSELVES

The Carnegie Center on 5th April published an article saying that the Nigerian government has created an alphabet soup of agencies and rolled out big-budget programmes to help small businesses.  However, rather than meeting the needs of small businesspeople these schemes are more often used by corrupt officials to help themselves.  It cites examples of the hijacking of such programmes, and says that they have a history of malfeasance and an ineffective track record.

https://carnegieendowment.org/2019/04/02/nigeria-s-small-businesses-want-government-help-but-corruption-is-draining-it-away-pub-78757

SAUDI ARABIA’S FIRST NUCLEAR REACTOR SPARKS FEARS FROM EXPERTS

Interesting Engineering on 4th April reported that Google Earth images show Saudi Arabia’s first nuclear reactor is almost finished, and reports say it could be producing power within a year.  However, it has sparked fears across the globe that the Kingdom plans to use nuclear technology without signing on to the international rules governing the industry.  Arms control experts fear the wealthy government could try and obtain nuclear weapons.

https://interestingengineering.com/saudi-arabias-first-nuclear-reactor-sparks-fears-from-experts

SANCTIONS AND THE MINING INDUSTRY

A “Practice Guide”, published by Getting the Deal Through in December 2018, provides quite a useful, brief introduction to sanctions as a general topic, as well as more specifically as they should be taken into account by the mining or extractive industry.

https://gettingthedealthrough.com/guide/181/article/6519/mining-sanctions-mining-industry

SANCTIONS, BANKS, AND SOUTH-EAST ASIA

Hogan Lovells published its SEA View briefing for April 2019 on 4th April – a new monthly newsletter.  The first edition focuses on the effect of (mainly US) sanctions on banks in SE Asia, and what they can do to protect themselves.

https://www.jdsupra.com/legalnews/o-sanction-my-sanction-sanctions-banks-74326/

SOUTH KOREA: BODYBUILDERS BOOKED FOR SMUGGLING ANABOLIC STEROIDS

The Korea Biomedical Review on 5th April published an article revealing the problem of anabolic steroid smuggling in Korea.  It reports the arrest of 12 bodybuilders and trainers had smuggled muscle-enlarging anabolic steroids and sold them with a drug wholesaler licence.  It says that the bodybuilders intentionally obtained a drug wholesaler licence to get the supply of prescription drugs and illicitly sold them, used cryptocurrency and cash only for transactions and frequently changed the sender’s addresses for delivery.

http://www.koreabiomed.com/news/articleView.html?idxno=5504

EGYPT SEIZES FOREIGN SHIP WITH 2 TONS OF HEROIN IN RED SEA

Urdu Point on 5th April reported that Egyptian naval forces seized a ship with 7 foreigners suspected of trying to smuggle more than 2 tons of heroin and 99 kg of “ice” into the country through the Red Sea.

https://www.urdupoint.com/en/world/egypt-seizes-foreign-ship-with-2-tons-of-hero-586303.html

PROSECUTE THE PROFITEERS: FOLLOWING THE MONEY TO WAR CRIMES ACCOUNTABILITY

On 4th April, Relief Web published a report saying that, to improve accountability for atrocities, governments, the private sector, and the courts must take aim at the financial infrastructure enabling violence.  Authorities in national and international courts, it says, should improve their approaches to investigating the financing of atrocities, greed motives, and profits derived by war criminals. They can do this using tool already at their disposal, including statutes prohibiting theft, sanctions violations, and atrocity crimes; diverse theories of liability; financial investigation strategies; and the seizure of ill-gotten wealth.  If these powers are not brought to bear, it says, key perpetrators, facilitators, and beneficiaries of some of the world’s worst crimes will continue to operate with impunity, and extreme violence will continue.  The report proposes a shift in the approach to justice for serious international crimes, targeting the perpetrators of atrocities where they are often most vulnerable: their money.  The analysis and recommendations focus on one of the deadliest and most lucrative parts of the world, East and Central Africa, and highlight important contemporary cases from elsewhere in the world.  8 key recommendations are put forward.

https://reliefweb.int/report/world/prosecute-profiteers-following-money-war-crimes-accountability

CORRUPTION COSTS $1 TRILLION IN TAX REVENUE GLOBALLY: IMF

KYC 360 on 5th April reported that curbing corruption could generate about $1 trillion in tax revenues annually across the world, according to research from the IMF.

https://www.riskscreen.com/kyc360/news/corruption-costs-1-trillion-in-tax-revenue-globally-imf/

THIRD COUNTRIES ALIGN THEMSELVES WITH EU ISIL/AL-QAIDA SANCTIONS

A news release from the EU on 5th April advised that North Macedonia, Montenegro, Serbia, Albania, Bosnia and Herzegovina, Iceland, Liechtenstein, Armenia and Georgia have agreed to align with EU sanctions.

https://www.consilium.europa.eu/en/press/press-releases/2019/04/05/declaration-by-the-high-representative-on-behalf-of-the-eu-on-the-alignment-of-certain-third-countries-concerning-restrictive-measures-against-isil-da-esh-and-al-qaeda-and-persons-groups-undertakings-and-entities-associated-with-them/

THIRD COUNTRIES ALIGN THEMSELVES WITH EU SANCTIONS IN RESPECT OF BELARUS

A news release from the EU advised that North Macedonia, Montenegro, Albania, Bosnia and Herzegovina, Iceland, Liechtenstein and Norway have agreed to align with EU sanctions.

https://www.consilium.europa.eu/en/press/press-releases/2019/04/05/declaration-by-the-high-representative-on-behalf-of-the-eu-on-the-alignment-of-certain-third-countries-concerning-restrictive-measures-against-belarus/

THE TEENAGE INVESTIGATIVE REPORTERS TAKING ON CORRUPTION IN KYRGYZSTAN

The Global Investigative Journalism Journal on 5th April published an article about the teenager-run Kloop website that found itself the only news organisation in Kyrgyzstan reporting the truth, with all other outlets shut down or scared of censorship.

https://gijn.org/2019/04/05/the-teenage-investigative-reporters-taking-on-corruption-in-kyrgyzstan

UK: KEY TAXATION DOCUMENTS

On 5th April, the House of Commons Library published a report that lists some of the most useful sources on tax law, tax policy and tax statistics, as well as guidance for taxpayers.  It also provides a checklist of official documents and briefing material on Budgets since 2010, and gives a short selection of other reading on the Parliamentary scrutiny of government taxation and spending.

https://researchbriefings.files.parliament.uk/documents/SN04680/SN04680.pdf

LOCAL AND GLOBALIST FOREIGN FIGHTERS: THE NEED TO DISTINGUISH BETWEEN DIFFERENT CATEGORIES OF FOREIGN FIGHTERS

A briefing from ETH Zurich on 5th April says that the broad definition of the term ‘foreign fighter’ causes operational problems for risk assessments.  It is therefore important for security officials to identify significant variations by classifying actors into major categories.  It says that when assessing the risk of continued security threats from foreign fighters, it is crucial to distinguish strategically between foreign fighters who join local rebel groups and those who join globalist groups.  It recommends that ways should be provided for foreign fighters who have joined local rebel groups to ‘opt out’ and return home after the end of fighting in order to discourage them from becoming globalist foreign fighters and to stem potential flows of foreign fighters to new theatres of conflict.

https://isnblog.ethz.ch/security/local-and-globalist-foreign-fighters

INTERNATIONAL AGREEMENTS IF THE UK LEAVES THE EU WITHOUT A DEAL

On 5th April, the Department for Exiting the EU published guidance which provides an update on the status of individual international agreements that the UK Government is delivering.

https://www.gov.uk/government/publications/international-agreements-if-the-uk-leaves-the-eu-without-a-deal

US: ESCAPED PONZI SCAMMER POSSIBLY WENT TO BRAZIL

The Daily Mail on 5th April reported that a man who masterminded a $100 million Ponzi scheme, Frederick Darren Berg (who was serving an 18-year prison sentence), and escaped from a federal prison in California may have fled to South America and federal officials have named his boyfriend as a person of interest in the case.  It says that investigators have been focusing their attention on his boyfriend, Darrell Ray Blankenship, a flight attendant who authorities say may have had access to a private jet and frequently travelled to Chile.

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https://www.dailymail.co.uk/wires/ap/article-6888207/Escaped-Ponzi-scammer-possibly-went-Brazil.html

SPAIN’S MATRICULATION TAX ON YACHTS TO COME UNDER SCRUTINY OF EUROPEAN COMMISSION

On 5th April, Superyacht News reported that Spanish nautical associations will argue that the tax goes against the principles of the European Single Market.  Spain’s matriculation tax is an additional indirect tax obligation on boats over 8 metres purchased or used in Spain and is a one-time charge consisting of 12% of the vessel’s value.

http://www.superyachtnews.com/business/spains-mat-tax-to-come-under-scrutiny-of-european-commission

MODEL FACE RECOGNITION USE POLICY

The Georgetown Law Center on Privacy & Technology issued a model policy in October 2016 to establish procedures for the acceptable use of the images, information, and tools within the face recognition system by law enforcement bodies.  Face recognition refers to an automated process of matching face images utilising algorithms and biometric scanning technologies.  Given the current ongoing discussions about the use of the technology, Kenneth Rijock in his blog pointed one towards this model policy.

https://www.perpetuallineup.org/appendix/model-police-use-policy

US ANNUAL TRADE BARRIERS REPORT SEES PROGRESS, CHALLENGES

On 5th April, Sandler Travis Rosenberg reported on the Office of the US Trade Representative annual National Trade Estimate report, which describes significant foreign barriers to US exports of goods and services, foreign direct investment, and e-commerce as well as the actions being taken to address those barriers.  The report details actions affecting US exports to 61 countries, the EU, Taiwan, Hong Kong, and the Arab League.  The report also includes information on barriers to digital trade.

https://www.strtrade.com/media/publication/7861_2019_National_Trade_Estimate_Report.pdf

https://www.strtrade.com/news-publications-trade-barriers-USTR-2019-report-NTE-040519.html

3 US PHARMACEUTICAL COMPANIES PAY $122 MILLION TO SETTLE FRAUD CLAIMS

Jurist on 5th April reported that Jazz, Lundbeck and Alexion did not admit liability for alleged health car fraud accusations but did reach settlement agreements with the DoJ.  It was said that the companies undermined a programme that was set up to assist patients in decreasing the cost of their drugs, and threatened the financial integrity of the Medicare programme.

https://www.jurist.org/news/2019/04/three-pharmaceutical-companies-pay-out-122-million-to-settle-fraud-claims/

NO CHANGES TO UK “RIGHT TO WORK” CHECKS FOR EU CITIZENS UNTIL 2021

On 5th April, an article from Out-Law advised that there will be no changes to the way in which individuals from the EU, EEA or Switzerland prove their right to work in the UK until 1st January 2021, even if the UK leaves the EU without a formal withdrawal agreement in place, the UK government has said.

https://www.out-law.com/en/articles/2019/april/no-changes-to-uk-right-to-work-checks-for-eu-citizens-until-2021/

UK P&I CLUB COMMISSIONS DOLPHIN SCULPTURE MADE OF RECLAIMED FLIP-FLOPS IN SUPPORT OF CHARITY OCEAN SOLE

On 1st April, the UK P+I Club reported it had commissioned a 2-metre long, 76 kg, multi-coloured dolphin sculpture made out of reclaimed flip-flops cleared from the East African coastline by social enterprise Ocean Sole.

https://www.ukpandi.com/knowledge-publications/article/press-release-from-ocean-waste-to-extraordinary-art-147934/?dm_t=0,0,0,0,0

COUNCIL FINED £145,000 FOR DISCLOSING SENSITIVE PERSONAL DATA ABOUT ALLEGED GANG MEMBERS

Local Government Lawyer on 5th April reported that the London Borough of Newham has been fined £145,000 for disclosing the personal information of more than 200 people who featured on the ‘Gangs Matrix’ police intelligence database.  The Information Commissioner’s Office had already, in November 2018, issued the Metropolitan Police with an order compelling it to make changes to the Matrix so it complies with data protection laws, including providing better arrangements for sharing the Matrix with partner agencies.  A wider investigation into police use of Matrix type databases continues.

https://www.localgovernmentlawyer.co.uk/information-law/398-information-law-news/40248-council-fined-145k-for-disclosing-sensitive-personal-data-about-alleged-gang-members

UAE CABINET RESOLUTION IMPLEMENTING NEW AML LAW

On 5th April, Baker McKenzie reported that, following the enactment of a new AML law in late 2018, on 28 January 2019 the UAE issued Cabinet Resolution No. 10 of 2019, which contains the provisions necessary for implementing the AML Law.  The article details a number of significant enhancements to the UAE AML regime that are introduced.

https://globalcompliancenews.com/uae-issues-cabinet-resolution-implementing-new-aml-law-20190318-2/

ARBITRATION COURT ORDERS DJIBOUTI TO PAY DP WORLD $385 MILLION

On 5th April, Port Technology reported that the London Court of International Arbitration (LCIA) has ordered Djibouti to pay DP World $385 million plus interest for breaking the 2006 Doraleh Container Terminal (DCT) concession agreement.  The Court found that Djibouti developed new container port opportunities with China Merchants Holdings International.  The case goes back to Djibouti’s expulsion of DP World from the DCT in February 2018 and attempted termination of the 50-year concession agreement.

https://www.porttechnology.org/news/lcia_orders_djibouti_to_pay_dp_world_385_million

ALLEGED ROMANIAN HEAD OF US ATM CARD SKIMMING SCAMS ARRESTED IN MEXICO

The Krebbs on Security blog on 5th April reported that the alleged top boss of a Romanian crime syndicate that US authorities say is responsible for deploying card-skimming devices at ATM throughout North America has been arrested in Mexico on firearms charges.

https://krebsonsecurity.com/2019/04/alleged-chief-of-romanian-atm-skimming-gang-arrested-in-mexico/

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https://www.statista.com/chart/17596/how-respondents-in-the-uk-feel-about-northern-ireland/

DEADLINE APPROACHES FOR BVI REGISTERED AGENTS AND TRUST COMPANIES TO REGULARISE THE STATUS OF REGULATED SUBSIDIARIES

A briefing from Harneys on 4th April reminds one that the Banks and Trust Companies Act, 1990 (the Act) had been amended by the Banks and Trust Companies Act, 2018 which requires BVI licensed registered agents and trust companies to remove listed subsidiaries from their licences and apply to have them separately licensed where necessary.  The deadline for doing so is 31st July.

https://www.harneys.com/insights/deadline-approaches-for-bvi-registered-agents-and-trust-companies-to-regularise-the-status-of-regulated-subsidiaries

REVISIONS TO FINANCING AND MONEY SERVICES REGULATION IN THE BVI

On 28th March, an article from Harneys reported that, following consultation during 2018, the BVI update has updated its financing and money services regime to:

  • to make it fit for purpose for local businesses based purely in the BVI which were involved in consumer financing, lending and on-the-ground money (payment) services; and
  • to prepare the groundwork for the BVI’s drive to become a hub for international FinTech businesses.

https://www.harneys.com/insights/revisions-to-financing-and-money-services-regulation-in-the-british-virgin-islands-following-2018-consultation

CYPRUS: DRAFT BILL TO IMPLEMENT EU ANTI-AVOIDANCE TAX DIRECTIVE

On 27th March, an article from Harneys says that the Bill contains 5 anti-abuse measures relating to controlled foreign companies (CFC), interest limitation, a general anti-abuse rule (GAAR), exit taxation and hybrid mismatches.  It is intended that the first 3 measures will apply retroactively as from 1st January whereas the latter 2 are expected to enter into force on 1st January 2020.

https://www.harneys.com/insights/cyprus-ministry-of-finance-presents-draft-eu-anti-tax-avoidance-directive

REFRESHER ON BVI DIRECTOR DUTIES, RISK AND MITIGATION

Harneys has provided a Legal Guide which says that the duties of a director of a BVI company are relatively easy to understand and reasonably easy for prudent directors to comply with.

https://www.harneys.com/media/1862/how-to-be-a-dutiful-director.pdf

FIATA/IATA CARGO AGENCY PROGRAMME UNDER WHICH FORWARDERS WOULD NO LONGER BE ‘AGENTS’ OF THE AIRLINES HALTED

Loadstar on 5th April reported that a Cargo Agency Modernisation Programme (CAMP) pilot programme had raised problems related to liability, commercial relationship and the variety of roles of the forwarders in the supply chain.  The intention had been to finally make freight forwarders principals in their contracts with airlines, instead of agents.

https://theloadstar.com/iata-fiata-cargo-agency-programme-hits-the-buffers

MORE CONTAINER INSPECTIONS COULD HELP FIGHT MARKET IN COUNTERFEIT GOODS

On 5th April, Loadstar reported that Maersk had announced in January that it had begun piloting container inspections in the US in a bid to improve safety standards, following a string of containership fires playing havoc with supply chains.  The article says that an offshoot of this greater scrutiny could be to aid cross-industry efforts to combat the maritime trade in fake goods – under the 2016 International Chamber of Commerce’s (ICC) Declaration of Intent (DoI) to prevent the maritime transportation of counterfeit goods.  The Trump Administration had recently ordered US Departments to put forward initiatives to stem the flow of counterfeit and similar illicit goods, deliveries of which have boomed under e-commerce.

https://theloadstar.com/more-safety-checks-on-containers-could-aid-war-on-counterfeit-goods/

VIDEO: TRACING RADIOACTIVE MATERIAL WITH NUCLEAR FORENSICS

A video on the IAEA website on 3rd April starts by saying that when any suspected radioactive material is found, for example at a border crossing or in a police raid, it is time to call in the nuclear forensic experts.

https://www.iaea.org/newscenter/multimedia/videos/tracing-radioactive-material-with-nuclear-forensics

TAX AUTHORITIES MOVE TO ARREST ARMENIAN TYCOON

Azatutyun in Armenia on 5th April reported that the official owner of Armenia’s leading freight and agribusiness company faces tax evasion charges which he strongly denied.  The State Revenue Committee (SRC) said that the Spayka company evaded over $14.4 million in import taxes as it asked a court in Yerevan to allow the pre-trial arrest of Davit Ghazarian.

https://www.azatutyun.am/a/29864077.html

CASINOS AND OFFSHORE BANKING KEEPS NORTHERN CYPRUS ON MONEY LAUNDERING RADAR

The Cyprus Mail on 5th April reported that casinos and the offshore banking sector in the breakaway Turkish Cypriot state in the north of the island remain areas of concern for money laundering activity, according to a recently-issued US State Department report.  There were 34 casinos in the north as of November 2018, the report said.  At the end of 2017, the sector consisted of 7 offshore banks and 411 companies.  There are also 22 banks in the area administrated by Turkish Cypriots, of which 17 are Turkish Cypriot-owned banks and 5 are branches of banks in Turkey.

https://cyprus-mail.com/2019/04/05/casinos-offshore-banking-keeps-north-on-money-laundering-radar

BAHAMAS FINANCIAL INTELLIGENCE UNIT OVERHAULED

On 5th April, the Nassau Guardian reported that a major overhaul of the FIU is underway, aimed at demonstrating to the international financial community The Bahamas’ commitment to AML/CFT and addressing criticism in regards to too few suspicious transaction reports.

https://thenassauguardian.com/2019/04/05/financial-intelligence-unit-overhauled

US GLOBAL INSURANCE BOSS CHARGED WITH POLITICAL BRIBERY

International Adviser reported on 5th April that the US DoJ has indicted Greg Lindberg and 3 others with “conspiracy to commit honest services wire fraud”.  He allegedly tried to offer hundreds of thousands of dollars in campaign contributions to get the US commissioner for insurance to favour his businesses.  He is the founder of Eli Global, a financial services company that invests in life insurance businesses, among others.

https://international-adviser.com/us-global-insurance-boss-charged-with-political-bribery

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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