BRITISH COLUMBIA TO LAUNCH BENEFICIAL OWNER REGISTRY FOR PROPERTY

On 3rd April, KYC 360 reported on the Landowners Transparency Act that would, if enacted, require corporations, trusts and other legal entities to name the true owners of real estate in British Columbia they currently own or are in the process of buying.

https://www.riskscreen.com/kyc360/news/british-columbia-to-launch-beneficial-owner-registry-for-property/

OTHER THINGS YOU MAY HAVE MISSED – APRIL 2

2nd April 2019

MULTICHANNEL FRAUD IN RETAIL BANKING

BAE Systems has produced an infographic, saying that payment fraud often takes place using `money mules` to transfer funds. This is very difficult to detect, particularly when the mule accounts are not at your bank. The results can be substantial losses through account compromise and fraudulent payments.  The infographic is designed to help one understand how some financial institutions automate detection across all channels in real-time, enabling payment mechanisms to hold suspicious payments and investigators to make adjudications on blocking them.

https://info.ai.baesystems.com/rs/308-OXI-896/images/multichannel_retail_banking_payments_fraud.pdf

GIBRALTAR SPANISH TAX TREATY – THE IMPACT ON INDIVIDUALS

On 29th march, Hassans in Gibraltar produced a briefing saying that the Gibraltar Spanish Tax treaty aims to eliminate uncertainty around the tax position of people who are treated as tax resident in both countries.  It will impact anybody who has connections to Spain and the implications should be carefully considered.

http://www.gibraltarlaw.com/gibraltar-spanish-tax-treaty%EF%BB%BF/

INDIA: PROCEEDS OF CRIME AND MONEY LAUNDERING UNDER THE PREVENTION OF MONEY LAUNDERING ACT

On 29th March, Vaish Associates Advocates published an article about a recent High Court case in India where the primary issue before the court was “What is Proceeds of Crime?”, for the purposes of the PMLA 2002.  The Court held that –

  • the expression “proceeds of crime” refers to a property, which is “derived or obtained” by any person as a result of criminal activity. Therefore, in order to pass an order of provisional attachment, it was necessary for the authorities to have reasons to believe that the property sought to be attached was “derived or obtained” from any scheduled crime; and
  • the assumption that any amount used in commission of a scheduled offence would fall within the expression “proceeds of crime” as defined in the PMLA is fundamentally flawed.

http://www.mondaq.com/india/x/794270/Money+Laundering/Proceeds+Of+Crime+And+Money+Laundering+Under+PMLA

CANADA EXPANDS SANCTIONS AGAINST RUSSIAN ENTITIES AND INDIVIDUALS

On 19th March, Borden Ladner Gervais LLP published an article saying that Canada had announced on a fresh round of Russian sanctions targeting 114 new individuals and 15 new entities, coordinated with the US, EU and Australia.  These new designations were said to be in response to Russia’s recent naval actions near Crimea, including the capture of Ukrainian sailors in the Black Sea and blockage of the Kerch Strait, which connects the Sea of Azoz to the Black Sea.

https://blg.com/en/News-And-Publications/Publication_5601

INDIA’S FRAUD INVESTIGATOR ARRESTS EX-CHAIRMAN OF DEBT-LADEN IL&FS

On 2nd April, KYC 360 announced the arrest of the former chairman of debt-laden Infrastructure Leasing and Financial Services (IL&FS) in connection with an ongoing investigation into the lender.  Hari Sankaran, the former chairman and managing director of IL&FS, is accused of “abusing his powers in IL&FS Financial Services Ltd through his fraudulent conduct”.

https://www.riskscreen.com/kyc360/news/indias-fraud-investigator-arrests-ex-chairman-of-debt-laden-ilfs/

NEW ZEALAND: NO JURISDICTION WITHOUT SERVICE: DIFFICULTIES OBTAINING INTERIM INJUNCTIONS AGAINST OFFSHORE COMPANIES

On 2nd April, Wilson Harle published an article saying that the High Court dismissed an interim injunction for lack of jurisdiction.  The judgment clarifies that the courts will not overlook the requirement for service and highlights the difficulty of seeking an interim injunction against companies that are based overseas.  Parties facing difficulties in effecting service on overseas persons should therefore be mindful of the possibility of seeking an order for substituted service.

https://www.internationallawoffice.com/Newsletters/Litigation/New-Zealand/Wilson-Harle/No-jurisdiction-without-service-difficulties-obtaining-interim-injunctions-against-offshore-companies

UK MUTUAL RECOGNITION OF CONFISCATION ORDERS

In a Court of Appeal judgment, the Court held that the Criminal Justice and Data Protection (Protocol No. 36) Regulations 2014 were to be read purposively so as to give effect to EU Framework Decision 2006/783 on the application of the principle of mutual recognition to confiscation orders.  The prosecution had obtained a certificate to enforce the confiscation order over the Appellant’s Spanish property.  The Regulations could be applied to confiscation orders made before their coming into effect unless it would cause real unfairness to do so.  Furthermore, confiscation orders could extend to property which did not directly represent the proceeds of crime where the defendant had benefited from general criminal conduct.  It was obvious from the wording and purpose of the EU Framework Decision that the whole scheme was designed to extend both to value confiscation and property confiscation systems.  The available amount under POCA could include property which might have no taint of criminality, but where there was a link to the benefit obtained by the defendant through general or particular criminal conduct.

https://blog.6kbw.com/posts/weekly-digest-1-april-2019

BREXIT: WHAT DO CUSTOMERS OF BRITISH FINANCIAL INSTITUTIONS IN GERMANY NEED TO KNOW?

Bird & Bird on 29th March published an article on a possible No-Deal Brexit, asking what would this mean for customers of British financial institutions, the European Passport and is German banking supervision prepared?  Without the European Passport, British financial institutions lose their license to operate in Germany and other EU Member States – with a wide set of consequences for the customers of the affected institutions.

https://www.twobirds.com/en/news/articles/2019/germany/brexit-what-do-customers-of-british-financial-institutions-in-germany-need-to-know

CAYMAN ISLANDS ECONOMIC SUBSTANCE REQUIREMENTS FOR CERTAIN ENTITIES – OVERVIEW

On 4th March, Maples published an article saying that the Economic Substance Law was amended on 22nd February and introduces certain reporting and economic substance requirements for ‘relevant entities’ conducting ‘relevant activities’.  The article says that the extent to which an entity is affected will depend upon a number of factors including the entity type, the type of business the particular entity is engaged in and the way in which it operates.  However, an initial step will be to determine whether an entity may fall within the classification of a ‘relevant entity’ and, if so, to determine if it is conducting or if it intends to conduct a ‘relevant activity’.

https://maples.com/Knowledge-Centre/Industry-Updates/2019/03/Cayman-Islands-Economic-Substance-Requirements-for-Certain-Entities-Overview

Separately, Maples published an article on the effect of the Law on shipping businesses.

https://maples.com/Knowledge-Centre/Industry-Updates/2019/03/Cayman-Islands-Economic-Substance-Requirements-for-Certain-Entities-Overview

ASSET RECOVERY IN MONACO

On 21st March, Donald Manasse Law Offices produced an article on civil and criminal asset recovery mechanisms in Monaco.

https://www.lexology.com/gtdt/tool/workareas/report/asset-recovery/chapter/monaco

SWEDISH BANK OFF THE HOOK ON MAGNITSKY MONEY LAUNDERING

On 2nd April, EU Observer reported that Sweden’s financial authority has said it will not pursue criminal proceedings against Swedbank over €157 million of Russian money allegedly laundered there because the alleged crime took place prior to tighter due diligence laws imposed in 2014 and after a 5-year statute of limitations had expired.

https://euobserver.com/tickers/144561

EU ACCUSED OF FUNDING ‘FORCED LABOUR’ PROJECT IN ERITREA

The EU Observer on 2nd April reported that Dutch-based Foundation Human Rights for Eritreans (FHRE) says conscripts for a road construction project are “trapped for an indefinite period within the service” and used as forced labour. FHRE says some €20 million from the EU’s Emergency Trust Fund for Africa is being used.

https://euobserver.com/tickers/144558

EU WATCHDOG GAINS NEW POWERS TO FIGHT MONEY LAUNDERERS

On 1st April, EurActiv reported that Member States have approved giving new powers to the European Banking Authority (EBA) to fight money laundering and terrorism financing, as part of an improvement of the European supervisory agencies (ESA).  The EBA will be bolstered with 10 people dedicated to fighting money laundering.  The EBA would be able to command national authorities to launch investigations into suspected activities, and could recommend sanctions, whereas currently it authority can open only ‘post-mortem’ investigations.

https://www.euractiv.com/section/economy-jobs/news/eu-watchdog-gains-new-powers-to-fight-money-launderers/

EU EXTENDS LIBYA SANCTIONS TO OCTOBER

EU Council Decision 2019/539/CFSP has extended the Libyan sanctions regime to 2nd October.

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2019.093.01.0015.01.ENG&toc=OJ:L:2019:093:TOC

US SUSPENDS TURKEY’S PARTICIPATION IN F-35 FIGHTER PROGRAMME OVER ITS PURCHASE OF RUSSIAN MISSILE SYSTEM

On 1st April, the Washington post reported that both the Trump administration and NATO have said would compromise the technology of the new-generation stealth fighter.  Turkey already has officially taken delivery of 2 of the aircraft, but the aircraft have remained in the US while Turkish pilots are being trained.  Turkey is also one of the co-producers of the $85 million jet, responsible for the manufacture of key components of the fuselage and cockpit.

https://www.washingtonpost.com/world/national-security/us-suspends-turkeys-participation-in-f-35-fighter-program-over-ankaras-purchase-of-russian-system/2019/04/01

AL-QAIDA- ASSOCIATED REBEL GROUP OPERATING IN MOZAMBIQUE

On 1st April, the Daily Monitor reported that the Allied Democratic Forces (ADF) rebels are said to be shifting their bases from DR Congo to a volatile part of northern Mozambique, it is also said that Madinat Tawhid-wa-I-Muwahidin (MTM), which is also fighting the Mozambique government, is there and that the ADF is now allied to Al-Qaeda. MTM is said to be led by a Ugandan associated with ADF.

https://www.monitor.co.ug/News/National/ADF-cell–Mozambique-security-expert-al-Qaeda/688334-5050460-bvlry

CHINA CLOSES LOOPHOLE ON FENTANYL-RELATED SUBSTANCES

On 1st April, the Wall Street Journal reported that China is clamping down on more substances related to the deadly opioid fentanyl, to meet a promise made to President Trump.  Chinese regulators announced that a wider range of fentanyl derivatives would be declared controlled substances from 1st May and laid out steps for further enforcement, including stepped-up investigations and better tracking of shipments.

https://www.wsj.com/articles/china-closes-loophole-in-fentanyl-rules-11554112953

ANNUAL GLOBAL THREAT/ATTACK INDEX INFOGRAPHIC

Now available online, provided by HIS Markit, is an interactive infographic produced by JTIC and which highlights key data and trends that enables one to better understand the global threat scenario.  Over the course of 2018 JTIC recorded a worldwide total of 15,321 attacks by non-state armed groups, which resulted in a total of 13,483 non-militant fatalities.  The attack figure represents a significant 33.2% decrease from the recorded number of attacks in 2017.  The figures represented the lowest annual attack total since 2011 and the lowest annual fatality figures since JTIC began collecting comprehensive event data in 2009.

https://ihsmarkit.com/Info/0318/2018-global-attack-index.html

EU COMMISSION CONCLUDES PART OF A UK TAX SCHEME GAVE ILLEGAL TAX ADVANTAGES TO CERTAIN MULTINATIONAL COMPANIES

On 2nd April, the EU announced that the Commission has found that a UK tax scheme is partly justified and does not constitute State aid.  However, it did find that the scheme unduly exempted certain multinational groups from these UK rules targeting tax avoidance, in breach of EU State aid rules.  The general purpose of the UK’s Controlled Foreign Company (CFC) rules is to prevent UK companies from using a subsidiary, based in a low or no tax jurisdiction, to avoid taxation in the UK.  It was found that a multinational active in the UK using an exemption was able to provide financing to a foreign group company via an offshore subsidiary paying little or no tax on the profits from these transactions.  The Commission therefore concluded that multinationals claiming the Group Financing Exemption while meeting the “UK activities test” received an unjustified preferential tax treatment that is illegal under EU State aid rules.  The UK must now recover the illegal State aid from the multinational companies that benefitted from it.

http://europa.eu/rapid/press-release_IP-19-1948_en.htm

TERRORISTS PREFER CASH OVER CRYPTOCURRENCY, EVEN PRIVACY COINS

CCN.com on 2nd April reported that a report from the RAND Corporation concludes that cryptocurrency is less than ideal for terrorist organisations.  Cash is still king for terrorists, for a variety of reasons, it says, including the liquidity barriers that regulation and legalisation of cryptocurrencies are presenting.

https://www.ccn.com/cryptocurrency-isnt-useful-for-terrorists-cash

US CONTINUING TO MONITOR REMITTANCES TO PHILIPPINES FOR POSSIBLE TERRORISM LINKS

The Inquirer in the Philippines reported on 2nd April that the US Government has said that it continues to monitor closely remittances sent home by overseas Filipino workers.

https://globalnation.inquirer.net/174068/us-official-we-continue-to-monitor-terrorist-financing-related-to-manila

FCA: THEMATIC REVIEW: AML/CFT AND THE E-MONEY SECTOR

On 2nd April, Allen & Overy published an article about a review that focused on e-money products, including prepaid cards and digital wallets.  The scope of the review excluded other services (such as money remittance) and activities outside of the FCA’s supervisory remit (including gift cards that can be used only within a limited network, or any prepaid product denominated in a virtual currency).  The article summarises the findings of the review.

https://www.jdsupra.com/legalnews/fca-thematic-review-money-laundering-49812/

PHILIPPINES; ILLEGAL ONLINE GAMBLING OPERATED RUN FROM INSIDE A JAIL

On 2nd April, Calvin Ayre reported that Philippines immigration operatives suspected an illegal operation was being run from inside prison, and launched a surprise raid on a Bureau of Immigration (BI) jail.  It is said that they found several Chinese nationals, who were previously arrested for operating illegal gambling dens in the region, had cash, credit cards, checks, laptops, computer monitors, routers and cellphones, and were using these devices to continue running secret online gambling operations directly from jail.

https://calvinayre.com/2019/04/02/business/philippines-illegal-gambling-operation-was-operating-from-jail/

ISLE OF MAN LEGISLATIVE UPDATE

On 1st April, Appleby published an article on legislation (and consultations) from the past quarter.  This included the European Union and Trade Act 2019 and the Dormant Assets Bill 2018.

https://www.applebyglobal.com/insights/insights-2019/isle-of-man-legislative-update-march-2019.aspx

SWEDBANK: FINANCE CRIME AUTHORITY TO INVESTIGATE INSIDER TRADING, BUT NOT MONEY LAUNDERING

On 2nd April, Baker McKenzie reported that the financial crime authority will not open an investigation into Swedbank for suspected money laundering following a police report from American financier Bill Browder, but is investigating the bank for insider trading.

http://www.riskandcompliancehub.com/swedbank-finance-crime-authority-to-investigate-insider-trading-but-not-money-laundering/

US UNHAPPY WITH JAMAICA’S PROSECUTION OF FINANCIAL CRIMES

On 2nd April, Baker McKenzie reported that one of the recommendations set out in the just-released 2018 International Narcotics Control Strategy Report reveals that the US has asked the Jamaican Government to take steps to build the capacity of its law enforcement, prosecution, and courts in order to successfully prosecute financial crime cases.

http://www.riskandcompliancehub.com/us-unhappy-with-jamaicas-prosecution-of-financial-crimes/

FORMER EXECUTIVE OF COLOMBIA’S GRUPO AVAL CONVICTED IN ODEBRECHT BRIBERY SCANDAL

On 2nd April, Baker McKenzie reported that a former CEO of a subsidiary of Colombia’s largest banking conglomerate, Grupo Aval, was convicted for bribing state officials.  Jose Alias Melo was convicted for his role in the 2009 bribery of Gabriel Garcia, the former vice-Transport Minister.

http://www.riskandcompliancehub.com/former-executive-of-colombias-grupo-aval-convicted-in-odebrecht-bribery-scandal/

MEXICO’S NEW AIRPORT BOSS LINKED INTERNATIONAL DRUG TRAFFICKING BY REPORT

Insight Crime on 2nd April reported that Deputy Director of Airports Supervision, Juan Manuel Hernández Palafox, has been said to allegedly have links to organised crime groups and facilitating the passage of drug shipments through Mexico City’s International Airport, as well as airports in Cancún, Guadalajara and Tijuana in reports originating from Mexico.

https://www.insightcrime.org/news/brief/mexico-head-airports-facilitating-international-drug-trafficking-report/

A GUIDE TO ANTI-CORRUPTION LEGISLATION IN THE ASIA PACIFIC

On 2nd April, Clifford Chance published the 6th edition of this publication, saying that businesses need to ensure that they are compliant with applicable anti-corruption laws in each of the countries in which they operate as well as with applicable international anti-corruption legislation with extraterritorial reach, such as the US Foreign Corrupt Practices Act and the UK Bribery Act.

https://www.cliffordchance.com/briefings/2019/04/a_guide_to_anti-corruptionlegislationinasi.html

NEW CREDIT UNIONS LEGISLATION IN ISLE OF MAN

On 2nd April the FSA reported that, following approval by Tynwald in March 2019, the FSA has introduced a new regulatory regime for credit unions with effect from 1st April.

https://www.iomfsa.im/fsa-news/2019/apr/new-credit-unions-legislation/

WIPO UNVEILS AI-POWERED TRADEMARK SEARCH TOOL

The World Intellectual Property Review on 2nd April reported that the World Intellectual property Organisation has launched an artificial intelligence-powered image search engine to make it faster and easier for brands to establish the distinctiveness of a trademark.  It said that the new technology will improve on previous tools because it will identify combinations of concepts within an image to find similar marks that have previously been registered.  The current search tools primarily determine trademark image similarity by identifying shapes and colours.

https://www.worldipreview.com/news/wipo-unveils-ai-powered-trademark-search-tool-17732?platform=hootsuite

AT THE CROSSROADS: COUNTER-TERRORISM AND THE INTERNET

In its April 2019 journal, the Texas National Security Review published an article which argues that counter-terrorism researchers need to tailor their recommendations to the corporate policymakers inside tech companies who want to do far more than the bare minimum.  It says that digital counter-terrorism efforts will not and should not be driven primarily by governments, even in a more aggressive regulatory environment.  Companies will continue to be primary actors in the counter-terrorism effort. The operative question is not whether they should work to improve, it is how, precisely, they should go about doing so.  Counter-terrorism researchers should recognise this, and tailor their recommendations not just to regulators working to set baselines, but to the corporate policymakers who want to do far more than the bare minimum.

https://tnsr.org/2019/04/crossroads-counter-terrorism-and-the-internet/

THE CRUCIAL ROLE OF THE MILITARY IN THE VENEZUELAN CRISIS

On 2nd April, the Stockholm International Peace Research Institute published an article saying that, since 1958, the Venezuelan armed forces have traded military support for the government in exchange for money, power and prestige.  This bargaining process was reinforced under the Chávez administration, which offered the military political power, money and arms, and strengthened the development of a military–government symbiosis.  Chávez acquired the right to approve promotions of colonels and generals—an instrument he used regularly to purge dissidents and promote loyal officers.  As a result, military officers took on key positions in state-owned companies, ministries and funding agencies.  The military’s influence on and within government has grown to a level not seen in Venezuela since the end of Marcos Pérez Jiménez’s dictatorship in 1948.  It says that, by giving the military money, power and prestige, Maduro has—at least for the time being—‘bought’ the political backing of the armed forces.

https://www.sipri.org/commentary/topical-backgrounder/2019/crucial-role-military-venezuelan-crisis

EU EXTENDS SOUTH SUDAN SANCTIONS FOR ANOTHER YEAR

On 2nd April, the EU Sanctions Blog reported that the US is continuing the “national emergency” declared under an Executive Order for a further year.

https://www.whitehouse.gov/briefings-statements/text-notice-congress-continuation-national-emergency-respect-south-sudan/

EX-FIRST LADY OF EL SALVADOR WILL PLEAD GUILTY TO CORRUPTION

On 2nd April, OCCRP reported local media stories that the former first lady of El Salvador, Ana Ligia Mixco de Saca, will plead guilty to her role in a corruption scheme that saw $25 million of public money laundered during her husband’s presidential tenure.

https://www.occrp.org/en/daily/9495-ex-first-lady-of-el-salvador-will-plead-guilty-to-corruption?src=ilaw

UK “BACKPEDALLING” OVER FOBT REPLACEMENT GAMES

On 2nd April, Calvin Ayre reported that 2 UK bookmakers were withdrawing machines intended to fill the gap left following the reduction in maximum stakes for fixed-odds betting terminals from £100 to £2 with effect from 1st April.  A third bookmaker is said to have been contemplating introducing such replacements.  The bookmakers are said to have been responding to a warning from the Gambling Commission regarding new products, which resembled variants of roulette, the same product most prominently featured on FOBT, that would have allowed maximum stakes of £100 to £500 by circumventing the letter of the new regulations.

https://calvinayre.com/2019/04/02/business/uk-bookies-regulatory-smackdown-fobt-dodge/

US DEEMS CANADA ‘MAJOR MONEY LAUNDERING COUNTRY’ AS GANGS EXPLOIT WEAK LAW ENFORCEMENT

Global News in Canada on 2nd April reported that the US State Department has designated Canada a “major money laundering country” where foreign drug-trafficking gangs are exploiting weak law enforcement and soft laws.  In the International Narcotics Control Strategy report, it joins a list of countries seen as vulnerable to significant drug money laundering transactions — such as Afghanistan, the BVI, China, Colombia and Macau.  The report says Canada is especially vulnerable to money laundering through casinos, real estate, money services businesses, currency exchanges, wire exchanges, offshore corporations, legal “funnel accounts” and bulk cash and hawala transactions.  Canada was also designated as a major source of drugs precursors for illicit narcotics and a source country for fentanyl.

https://globalnews.ca/news/5102137/us-canada-major-money-laundering-country/

BARRISTER WINS RIGHT TO SEE HIS BANK’S SUSPICIOUS ACTIVITY REPORTS

On 1st April, Allen & Overy reported on a High Court case where a bank was ordered to disclose, to a customer, SAR that the bank had sent to the NCA at the time of freezing the customer’s bank accounts.  The bank’s arguments concerning confidentiality, tipping-off and prejudicing an investigation were unsuccessful.  The court’s observations on the interplay between the SAR regime and the law on data protection, defamation and breach of contract will be of interest to all banks.  The customer had launched a multi-pronged attack on the bank’s actions, including claims for breach of contract, defamation, breach of the Data Protection Act 1998 and also an application for disclosure of the SAR.  Implicit in all these claims was the customer’s belief that the bank did not hold a genuine suspicion that the money in his accounts constituted the proceeds of crime, that his accounts had been unnecessarily frozen and his reputation damaged.

http://www.allenovery.com/publications/en-gb/Pages/Barrister-wins-right-to-see-his-banks-suspicious-activity-reports.aspx

NIGERIA SUSPENDS CORRUPTION PROBE INTO NEW GOVERNOR

On 1st April, OCCRP reported that the Economic and Financial Crimes Commission (EFCC) is preparing to suspend a multi-million dollar corruption probe into a newly-elected state governor – Bala Mohammed, a member of the centre-right People’s Democratic Party (PDP), yielding to a constitutional provision that grants absolute immunity from criminal prosecution to an elected governor.

https://www.occrp.org/en/27-ccwatch/cc-watch-briefs/9489-nigeria-suspends-corruption-probe-into-new-governor

ANNUAL GLOBAL THREAT/ATTACK INDEX INFOGRAPHIC

Now available online, provided by HIS Markit, is an interactive infographic produced by JTIC and which highlights key data and trends that enables one to better understand the global threat scenario.  Over the course of 2018 JTIC recorded a worldwide total of 15,321 attacks by non-state armed groups, which resulted in a total of 13,483 non-militant fatalities.  The attack figure represents a significant 33.2% decrease from the recorded number of attacks in 2017.  The figures represented the lowest annual attack total since 2011 and the lowest annual fatality figures since JTIC began collecting comprehensive event data in 2009.

https://ihsmarkit.com/Info/0318/2018-global-attack-index.html

CAYMAN ISLANDS RESPONDS TO CARIBBEAN FINANCIAL ACTION TASK FORCE (CFATF) REPORT

Cayman Finance has issued a news release responding to the recently published Caribbean Financial Action Task Force (CFATF) Fourth Round Mutual Evaluation Report.  It outlines initiatives it says are already underway.  These include a training programme undertaken in conjunction with the Economic Crime Unit of the City of London Police.  There is also to be the secondment of NCA personnel from the UK to conduct an overall strategic crime threat/risk assessment for the Cayman Islands; and this assessment will include an analysis of risk in the financial sector.

https://www.cayman.finance/2019/03/cayman-islands-committed-caribbean-financial-action-task-force-cfatf-progress/

OTHER THINGS YOU MAY HAVE MISSED – APRIL 1

1st April 2019

 SWITZERLAND TO SUE NIGERIA OVER SEIZED OIL TANKER

Swissinfo on 31st March reported that authorities in Switzerland are considering legal proceedings after failed diplomatic efforts to secure the release of a Swiss-flag-carrying oil tanker, blocked in the bay of Biafra for over a year.  The San Padre Pio oil tanker, registered by ABC Maritime, was seized by Nigerian authorities in January 2018, who accused the ship and its crew of violating territorial waters and diesel smuggling.

https://www.swissinfo.ch/eng/international-spat_switzerland-to-sue-nigeria-over-seized-oil-tanker/44863116

NEW ZEALAND: FINANCIAL MARKETS AUTHORITY SAYS MONEY LAUNDERING SAFEGUARDS STILL NOT FIT FOR PURPOSE

On 1st April, Scoop reported an FMA news release saying that the FMA had released AML/CFT monitoring report setting out the areas requiring further attention by the management and boards of the reporting entities it supervises.  The FMA is one of 3 supervisors for AML/CFT in New Zealand, alongside the Reserve Bank of New Zealand and the Department of Internal Affairs.  Amongst the issues raised is that an increasing number of entities are using electronic identify verification, but the FMA noted a number of deficiencies with their AML/CFT programmes in this regard.  It also said that when undertaking operational reviews, the FMA will focus more on front-line staff who perform tasks such as client on-boarding, to assess their understanding of the obligations.

http://www.scoop.co.nz/stories/BU1904/S00006/amlcft-monitoring-report-highlights-concerns-sets-focus.htm

http://www.sharechat.co.nz/article/b53a23c8/fma-says-money-laundering-safeguards-still-not-fit-for-purpose.html

MALTA: OPPOSITION LEADER ASKS FOR INVESTIGATION INTO HIS “FORGED” SIGNATURE ON DOCUMENTS AND ASKS IF LINKED TO MONEY LAUNDERING PROBE

On 1st April, the Times of Malta reported that opposition leader, Adrian Delia, went to the FIAU with documents which he says had his forged signature and asked them to investigate whether the documents were in any way linked to the findings of a money laundering probe, of which he was the subject last year.  It is reported that in 2018 the FIAU had concluded there was reasonable suspicion that he had been involved in laundering the proceeds of a London brothel back in the early 2000s which had been deposited in an account in Jersey.  Reports had linked Delia to the company said to have run the brothel, as well as others linked to the man said to be behind the operation.

https://www.timesofmalta.com/articles/view/20190401/local/forged-signature-documents-linked-to-shelf-firm.706139

INDIA: DEMONETISATION TRIGGERS RECORD 14-TIMES GREATER NUMBER OF SAR LINKED TO TAX CRIMES

On 31st March, Money Control reported that the 2016 removal of 2 high-value currency notes has led to an all-time high number of suspicious activity reports, a record 1,400% jump over the pre-demonetisation period, by banks and other financial institutions in the country, according to a FIU report.

https://www.moneycontrol.com/news/business/economy/demonetisation-triggers-record-14-times-high-generation-of-suspicious-reports-linked-to-tax-crimes-fiu-report-3734501.html

HOW SHADOWY TAX HAVENS SKIRT CONSERVATION EFFORTS

The Salon website on 29th March reported on an investigation into the data by Victor Galaz and colleagues from the Stockholm Resilience Center.  It says that they were most interested in the environmental consequences of the global financial system.  They used publicly available data from INTERPOL and other sources to uncover how secret financial dealings fuel 2 major conservation threats: overfishing in the world’s oceans and deforestation of the Brazilian Amazon.  It says that illegal, unreported, and unregulated (IUU) fishing is a serious cause of declining fish populations worldwide, and criticises Belize, Panama, and many other tax haven countries.

https://www.salon.com/2019/03/29/how-shadowy-tax-havens-skirt-conservation-efforts_partner/

FUGITIVE TYCOON TO CHALLENGE HONG KONG’S EXTRADITION PLANS
Channel News Asia on 1st April reported that Joseph Lau is set to launch a legal challenge against Hong Kong’s controversial plan to sign an extradition agreement with Macau, Taiwan and mainland China.  Hong Kong property tycoon Joseph Lau is wanted in Macau where he was convicted in absentia for bribery in the gambling enclave in 2014.  He remains a free man because Hong Kong and Macau do not currently have an extradition agreement.

https://www.channelnewsasia.com/news/asia/fugitive-tycoon-to-challenge-hong-kong-s-extradition-plans-11399672

GIBRALTAR: NO-DEAL BREXIT – CIVIL LITIGATION INVOLVING EU MEMBER STATES

A news release from the Gibraltar Government on 29th March sets out to explain the effect of a No-Deal exit from the EU on the handling of civil legal cases involving other EU jurisdictions.  It covers rules such as those concerning applicable legislation in cross-border civil and commercial disputes, cross-border insolvency proceedings and matters of family law.

https://www.gibraltar.gov.gi/new/sites/default/files/press/2019/Press%20Releases/232-2019.pdf

SPANISH EURO COUNTERFEITING PRINT-SHIP BUSTED

A news release from Europol on 30th March reported that the Spanish National Police have dismantled the most active counterfeit euro print shop in Spain with the support of Europol. The specialised crime ring, based in Tenerife, manufactured fake banknotes in €10 and €20 denominations, earning the gang around €7,500 every month.

https://www.europol.europa.eu/newsroom/news/spanish-euro-counterfeit-print-shop-busted

FIATA PUBLISHES BEST PRACTICE ON PREVENTION OF CYBERCRIME FOR FREIGHT INDUSTRY

On 28th March, the International Federation of Freight Forwarders Associations (FIATA) issued “Best Practice Guide on Prevention of Cybercrime” for FIATA members and the industry at large.

https://fiata.com/fileadmin/user_upload/documents/initiatives/FIATA_Best_Practice_on_Prevention_of_Cybercrime.pdf

WHAT IS GOING ON IN LIBYA?

An article from War on the Rocks on 1st April looks at the situation in Libya, including the links between Libya’s petrodollars, the feuding factions, and the foreign states backing them.  It says that Earlier this year, the armed coalition led by eastern-Libyan-based commander Khalifa Haftar seized an oil-rich desert expanse 3 times as large as Syria called the Fezzan.  There is now speculation on whether he will attempt to take the capital, Tripoli.  Haftar has not recognised the UN-backed Government of National Accord in Tripoli, and its prime minister and his cabinet co-exist with a set of powerful militias there, but do not control them.

https://warontherocks.com/2019/04/libyas-looming-contest-for-the-central-bank/

EUROPEAN BORDER AND COAST GUARD: COMMISSION WELCOMES AGREEMENT ON A STANDING CORPS OF 10,000 BORDER GUARDS BY 2027

On 1st April, a news release from the EU said that the EU Council has approved the political agreement reached to reinforce the European Border and Coast Guard, giving it the right level of ambition to respond to the common challenges Europe is facing in managing migration and borders.  The centre piece of the reinforced Agency will be a standing corps of 10,000 border guards – ready to support Member States at any time.

http://europa.eu/rapid/press-release_IP-19-1929_en.htm

THIRD COUNTRIES ALIGN WITH EU SANCTIONS ON ZIMBABWE

A news release from the EU on 1st April announced that North Macedonia, Montenegro, Serbia Albania, Bosnia and Herzegovina, Iceland, Liechtenstein, Norway and Armenia have aligned with EU sanctions which the EU has extended to 20th February 2020.

https://www.consilium.europa.eu/en/press/press-releases/2019/04/01/declaration-by-the-high-representative-on-behalf-of-the-eu-on-the-alignment-of-third-countries-with-the-council-decision-concerning-restrictive-measures-against-zimbabwe/

UK: EMPLOYING EU, EEA AND SWISS CITIZENS AND THEIR FAMILY MEMBERS AFTER BREXIT

On 1st April, the Home Office issued updated information for employers on “right to work” checks and the immigration status of EU, EEA and Swiss citizens and their family members working in the UK after Brexit.  It says that there will be no change to the way EU, EEA and Swiss citizens prove their right to work until 1st January 2021.  This remains the same if the UK leaves the EU without a deal.

https://www.gov.uk/guidance/employing-eu-eea-and-swiss-citizens-and-their-family-members-after-brexit

7 ALGERIAN BUSINESSMEN INVESTIGATED FOR CORRUPTION

On 1st April, Arab News said that Algerian authorities have seized the passports of 7 businessmen under investigation over corruption allegations, the private Ennahar TV channel reported.

http://www.arabnews.com/node/1475906/middle-east

MALTA: FINANCE MINISTER CLAIMS UNFAIR TREATMENT AFTER DRAFT MONEYVAL REPORT WAS LEAKED

On 1st April, Malta Today reported the Finance Minister’s complaints that leaked extracts from an ongoing Moneyval evaluation process claimed that Malta has failed the initial test of its AML systems.  Sources told the Times of Malta that, in the last evaluation, out of 11 measures of effectiveness graded (known as “IO”) – ranging from international cooperation to local supervisory functions and policing – none were considered good enough to score a “high”.  The minister said that that it was unfair that, due to the leak, the evaluation process had to be stopped in the middle, while, in other countries, it is allowed to take its due course.

https://www.maltatoday.com.mt/news/national/94024/finance_minister_claims_unfair_treatment_after_draft_moneyval_report_was_leaked

AUTHORITIES SAY FORMER GAMBIA PRESIDENT STOLE $363 MILLION

OCCRP on 1st April reported that Gambia’s official inquiry into the corruption of former President Yahya Jammeh found he had looted at least $363 million of public funds during his more than 2 decades in power.

https://www.occrp.org/en/27-ccwatch/cc-watch-briefs/9487-authorities-say-ex-gambia-president-stole-us-363-million

PAKISTAN PLANS TO REGULATE CRYPTOCURRENCY TO PREVENT ‘TERRORISM FINANCING’

Baker McKenzie on 1st April reported that Pakistan has announced plans to regulate cryptocurrencies in accordance with recommendations of FATF.  The regulations will be introduced immediately.

http://www.riskandcompliancehub.com/pakistan-regulates-cryptocurrency-to-prevent-terrorism-financing/

 

EXPORT CONTROLS AND SANCTIONS: PREPARING FOR THE IMPACT OF A NO-DEAL BREXIT

On 1st April, Baker McKenzie published a very good briefing that sets out some of the main sanctions and export controls issues arising from a no-deal Brexit which are likely to impact upon companies operating in the UK and EU, and provides guidance on what companies can do to prepare for this eventuality.

http://bakerxchange.com/rv/ff00496e6b99a86c5e02b22c7047b6b72b1bfccd

CHINA’S TIMBER TRADE – TIME FOR IT TO TAKE RESPONSIBILITY

On 1st April, a report from Global Witness said that millions of tonnes of timber enters China every year, with its vast wood manufacturing sector dependent on raw materials from overseas.  But much of that timber comes from countries where corruption and weak rule of law is leading to high levels of illegal logging.  The country’s exposure to high-risk timber is damaging to its own and its trading partners’ long-term development.  It is time, it says, for China to take responsibility for this, step up to this global challenge and lead the way on tackling the spread of illegal timber.  It says that most of the 10 largest suppliers of tropical timber to China rank in the bottom quarter of global ranking on measures of governance.  Not only this, but the research we have compiled shows widespread and worrying levels of illegalities in countries from which China sources over 80% of its tropical timber.  The report lays out a range of recommendations, outlining action China could take.

https://www.globalwitness.org/en-gb/campaigns/forests/lessons-from-chinas-global-forest-footprint/

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