16th July 2019
LATVIA: BANKING WATCHDOG FINES RIGENSIS BANK €1.03 MILLION FOR MONEY LAUNDERING VIOLATIONS
On 15th July, LETA 100 reported that the Financial and Capital Market Commission (FCMC) has imposed a fine of €1,028,850 on Rigensis Bank for violations of requirements of the laws and regulations on the prevention of money laundering and financing of terrorism and proliferation. These included cases of not properly identifying beneficial owners, clarifying the origin of funds, or examining properly transactions with seemingly no legitimate or economic purpose.
EU AGREES SANCTIONS AGAINST TURKEY FOR DRILLING OFF CYPRUS
On 15th July, France 24 reported that EU had agreed political and financial sanctions against Turkey after it went ahead with drilling operations off Cyprus despite repeated warnings. The most serious measure is understood to be a cut of €145.8 million in the EU funds allocated to Turkey for 2020. It was the discovery of huge gas reserves in the eastern Mediterranean that sparked the dispute between EU member Cyprus and Turkey. Turkey sent 2 ships to carry out drilling off the Cypriot coast despite the warnings from the EU.
SRI LANKA: GARBAGE SMUGGLING RACKET EXPOSED
Hiru News in Sri Lanka reported on 15th July that Sri Lankan customs had uncovered a racket whereby waste s=was smuggled from developed countries such as the UK to Sri Lanka.
LATVIA: NON-RESIDENT DEPOSITS DOWN €10 BILLION SINCE MONEY LAUNDERING CRACKDOWN
LSM.LV reported on 15th July that about €10 billion in non-resident deposits have been moved out of Latvia since the country stepped up its fight against money laundering. Latvia has been seriously stepping up its AML efforts since ABLV Bank, once Latvia’s third largest lender, folded last spring after a damning report on the bank by FinCEN in the US.
VENEZUELA DEFIES SANCTIONS TO SELL $40 MILLION IN GOLD RESERVES
On 16th July, KYC 360 reported that the central bank sold nearly 1 ton of gold July 12th, lowering Venezuela’s dollar reserves to a near 3-decade low of $8.1 billion. Maduro has been selling gold to firms in places such as UAE and Turkey, reaching approximately 24 tons in sales since the beginning of April.
ITALY: “BRIBE DESTROYER” LAW VERSUS THE STADIO DELLA ROMA SCANDAL
Squire Patton Boggs, in its Anticorruption Blog, published on 11th July a post contrasting a recently approved Bill known as the Spazzacorrotti, or “Bribe Destroyer” with a high-profile bribery scandal related to the construction of AS Roma’s new football stadium. The article says that estimates are that the Italian economy loses up to €236 billion a year to corruption – and if accurate, that figure equates to approximately 13% of GDP and 150% of the annual public health budget. Promotion of the Bill by the ruling Five Star Movement is set against one of its top officials becoming embroiled in a highly charged scandal regarding the alleged bribery.
COMPARING THE ANTI-BRIBERY AND CORRUPTION LEGISLATION OF RUSSIA AND FORMER SOVIET REPUBLICS
On 15th Article, Noerr produced a briefing comparing the anti-bribery and corruption legislation of Russia, Azerbaijan, Kazakhstan, Kyrgyzstan, Turkmenistan and Uzbekistan. Its review of these countries’ legislation revealed significant differences, which I says show that the local liability risks for companies operating in these countries and their employees must be assessed for each jurisdiction individually.
CZECH REPUBLIC DENIES CHINA’S REQUEST FOR TAIWANESE TELECOM FRAUD SUSPECTS
On 16th July, the Taiwan Times reported that the Czech Republic has rebuffed Beijing’s request to extradite 8 Taiwanese telecom fraud suspects on the grounds that they could face inhumane treatment. The Chinese government alleges that the suspects have posed as Chinese public security officers and dialled overseas phone numbers to defraud Chinese nationals living in Australia.
AUSTRALIA: THE BOOKSHELF DISGUISING A SECRET DOOR THAT LED TO A SOPHISTICATED DRUG OPERATION RUN BY A COLOMBIAN GANG
The Mail Online on 16th July reported that Australian Federal Police are trying to seize a property in Sydney under the Proceeds of Crime Act alleging the house was constructed with hidden rooms as a front for the drug operation. A raid was conducted at the house in 2017 where AFP officers found the rooms in a cellar behind an entrance disguised as a bookshelf.
IRANIAN CRANE VESSEL RELEASED FROM KUWAITI PORT AFTER 10 MONTHS
Customs Today reported on 16th July that Tidewater Middle East Co., the largest Iranian port operator, said that the vessel, Arvand Tide 1000, had been released from Kuwait’s Port of Shuaiba before sailing toward Iran. Tidewater said the ship had been seized in Kuwait for “baseless allegations” last year right after the discharge of a 180-day chartering contract with a Kuwaiti company.
CANADIAN OFFICIALS FLAGGED 900 FOOD ITEMS FROM CHINA WITH ‘PROBLEMS’ OVER 2 YEARS
Customs Today on 16th July reported that Canadian inspectors intercepted nearly 900 food products from China over concerns about faulty labels, unmentioned allergens and harmful contaminants that included glass and metal between 2017 and early 2019. The scrutiny of agricultural goods has been central to a diplomatic dispute between Canada and China. Bilateral frictions have intensified since the December arrest of a Huawei executive in Vancouver and China’s subsequent detention of 2 Canadians on espionage allegations.
FOUNDER OF A WASHINGTON PRIVATE INTELLIGENCE COMPANY TOOK ON A RISKY NEW CLIENT: A MEXICAN DRUG CARTEL
The Daily Beast reported on 12th July that federal law enforcement raided the house and seized the electronics of executive Michael Bagley in connection with a money laundering investigation. Federal prosecutors charged Bagley with money laundering after he allegedly helped confidential FBI sources posing as narcotics cartel representatives hide what he thought was more than $250,000 in illicit proceeds. Bagley is the founder of the Washington, DC, private intelligence firm Jellyfish Partners.
JAPAN DID NOT TAKE ACTION AGAINST SHIPS SUSPECTED OF CARRYING NORTH KOREAN COAL, SAYS SOUTH KOREA
Amid an increasing trade row between Japan and South Korea which sees the states exchanging allegations, South Korea’s intelligence agency is reported as saying that foreign-flagged ships suspected of carrying North Korean coal docked at and departed from Japanese ports and Tokyo did not take action against them, in potential violation of UN sanctions. Yonhap News carried an article about this on 16th July. Cargo ships, such as the Togo-flagged Shinning Rich and the Belize-flagged Jin Long, made port calls in Japan, lawmakers told reporters. In placing export curbs on South Korea, Japan has recently raised suspicion that hydrogen fluoride shipped to South Korea from Tokyo was funnelled to North Korea in violation of UN sanctions. The material can be used to produce chemical weapons. South Korea rejects the suggestion.
EU COURT ORDERS COMPENSATION OVER ANNULLED IRANIAN SANCTIONS
On 16th July, the EU Sanctions Blog reported that the EU General Court had ordered compensation payments in respect of Fereydoun Mahmoudian and Fulmen (an Iranian company). The General Court had ordered annulment of their listing in 2012, and this decision was upheld by the ECJ in 2013, with the listings finally being revoked in 2013. The compensation was for listing of the two between 2010- and 2013, with the failure of the EU Council to substantiate the reasons for the applicants’ designations with evidence for over 3 years being seen as a serious breach of EU law. Mahmoudian received a total of €92,000 (including €500 for each month in which his assets were frozen), and Fulman received €50,000 for damage to reputation.
UK NATIONAL LOTTERY AND SOCIETY LOTTERY CHANGES
On 16th July, a news release from the Department for Digital, Culture, Media and Sport reported that consultation will be undertaken on increasing the minimum age to take part in the National Lottery (including scratchcards and online) is to be increased from 16 to 18. It also advised that there would be an increase in society lotteries’ maximum draw prize from £400,000 to £500,000, and raise the society lotteries’ annual sales limit to £50 million. The consultation on the change for the National Lottery will last 12 weeks from 16th July to 8th October.
TAIWAN ASKS HONG KONG AND CHINA TO HELP FIGHT ONLINE LOVE SCAMS
Channel News Asia on 16th July reported that Taiwan has urged China and Hong Kong to work together to investigate a spate of financial love scams that have caused over $30 million in losses to Taiwanese targets. According to the Criminal Investigation Bureau, suspects based in China and Hong Kong used social media to start romantic relationships with victims in Taiwan, and then coaxed them to invest in fake financial companies. Over 500 local people have been swindled since January last year.
SLOVAK HAULIERS COULD RECOVER UP TO €340 MILLION DUE TO A PRICE-FIXING TRUCK CARTEL
The Slovak Spectator reported on 16th July that the case involved the sale and leasing of trucks at elevated prices, concerns about 400 transport companies in Slovakia and more than 10,000 registered vehicles lasting for several years. Commercial fleet operators in Slovakia who overpaid for trucks from firms that colluded in a price-fixing cartel could recover damages of up to €340 million, according to a recent report. Truck manufacturers Daimler, Volvo/Renault, Iveco, MAN, DAF and Scania are affected.
AUSTRIAN JUSTICE MINISTER ALLOWS EXTRADITION OF UKRAINIAN OLIGARCH FIRTASH TO US
The Kyiv Post on 16th July reported that the Austrian Justice Minister has approved the extradition of Ukrainian oligarch Dmytro Firtash to the US. Firtash faces trial in Chicago on bribery charges, and has been living in Austria since 2014, fighting extradition. The tycoon was once an ally of ousted Ukrainian president Viktor Yanukovych, and had links to Paul Manafort. He still owns the Group DF, a conglomerate that includes regional gas distribution companies, titanium and fertiliser plants in Ukraine. The group also controls several Ukrainian TV channels.
BINARY OPTIONS BOSS GOES ON TRIAL FOR $150 MILLION FRAUD
On 16th July, the Bureau of Investigative Journalists published an article about Lee Elbaz, aka Lena Green, was the CEO of Yukom, a company that operated binary options trading platforms under trade names such as BigOption and BinaryBook.
CHALLENGES OF THE OFFICE OF THE SPECIAL PROSECUTOR IN FIGHTING CORRUPTION IN GHANA
Graphic Online on 16th July carried an article saying that the greatest problem facing the Office are the the heads of institutions who simply refuse to comply with laws designed to ensure good governance and to protect the national purse by fighting corruption.
US SUPREME COURT SAYS FOREIGN PROSECUTIONS FOR SAME OFFENCE NOT DOUBLE JEOPARDY
On 16th July, an article from Baker Hostetler reported that, in Gamble v. United States, the Supreme Court held that the Double Jeopardy Clause of the 5th Amendment to the US Constitution does not prohibit a successive US federal prosecution of an individual for the same conduct that was at issue in the defendant’s prior conviction in another country – thus affirming the long-standing “dual-sovereignty” doctrine (i.e. a crime under one sovereign’s laws is not “the same offence” for double jeopardy purposes as a crime under the laws of another sovereign). However, the article also mentions that in 2018 the DoJ adopted a non-binding policy that promotes co-ordination between US and foreign law enforcement in an effort to limit duplicate penalties on corporate entities for the same conduct. The article says that recent enforcement actions show that it appears to be following this “anti-piling on” policy.
LAWFUL SALE OF CANNABIS LIGHT IN ITALY: IS IT GOING UP IN SMOKE?
A briefing from Clifford Chance on 16th July saying that Italy’s cannabis market has been booming since December 2016 – but the law that allowed this governs the cultivation of the hemp plants, but it does not address other implications of hemp cultivation such as the sale of hemp derivatives containing tetrahydrocannabinol (THC), the active ingredient that led to cannabis becoming an illegal drug. This regulatory gap has created a grey area that a number of entrepreneurs, but a recent ruling by the Italian Supreme Court, however, is likely to reduce enthusiasm in this new sale stream
UK: COUNTERFEIT CURRENCY – WHAT TO DO IF YOU RECEIVE COUNTERFEIT NOTES OR COINS AND WHERE TO REPORT
Information published by Action Fraud on 7th July says that, with an estimated 3.7 billion genuine bank notes currently in circulation in the UK, counterfeiting is viewed as big business by organised crime syndicates. In 2018, around 461,000 counterfeit Bank of England banknotes with a face value of £10 million were taken out of circulation.
UKRAINIAN FAR-RIGHT EXTREMISTS CONTINUE TO RECEIVE STATE FUNDS TO TEACH “PATRIOTISM”
An article from Bellingcat on 16th July says that Ukraine’s far-right groups and their ideas enjoy little popular support among its citizens. Despite this, Ukraine’s government continues to provide funds to notorious far-right extremist groups and their affiliates — including 2 organisations led by extremists currently on trial for a 2015 murder — to carry out “national-patriotic education” (NPE) programs aimed at young Ukrainians.
US RELEASES CONTAINER SHIP FOUND WITH 20 TONS OF COCAINE – BUT STILL PLANS FORFEITURE
Hellenic Shipping News on 16th July reported that authorities have released the container ship that was seized with 20 tons of cocaine in Philadelphia after the operator posted a $50 million bond, including $10 million in cash, but said they still plan to consider seeking forfeiture of the vessel.
UN EXPERTS WARN OF THE INCREASING THREAT FROM PETTY CRIMINALS WHO TURN TO TERRORISM
Homeland Security Today reported on 10th July the remarks of Tamara Makarenko, an international consultant who works with the UN Interregional Crime and Justice Research Institute, that less predictable threats represented by small-time criminals who have opportunistically embraced terrorism, are a source of growing concern – based primarily on transactions and tactics, at the point where terrorists and criminals occupy “the same space at the same time”. Terrorist groups use illicit crimes to fund their operations. Yuri Fedetov, Executive Director of the UN Office on Drugs and Crime, added that criminals and terrorists shared a need to operate in the shadows, exploiting gaps in criminal justice responses in and between countries and regions.
NEW UN AND INTERPOL COUNTER-TERRORISM HANDBOOK HELPS INVESTIGATORS USE ONLINE DATA
On 16th July, Homeland Security Today carried an article saying that the UN Counter-Terrorism Centre (UNCCT) and INTERPOL have jointly produced a handbook to help investigators collect, analyse and share information found online, particularly on social media platforms.
2 BROTHERS INDIANA ACCUSED OF MAKING GUNS FOR ISIS
An article in Homeland Security Today on 15th July reported that a federal grand jury has charged brothers Moyad Dannon, 21, and Mahde Dannon, 20, with multiple firearms charges and attempting to provide material support and resources, including firearms, to ISIS. One brother hatched a scheme to deliver firearms, including stolen firearms, to a convicted felon who was co-operating with the FBI. Between July 2018 and December 2018, the Dannon brothers sold a number of illegally-obtained firearms to the cooperating individual, and began to manufacture untraceable “ghost guns” by purchasing firearms parts without serials online and assembling those parts into fully-functioning semi-automatic rifles.
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