30th July 2019
US GOVERNMENT SELLS $42 MILLION YACHT BELONGING TO NIGERIAN OIL MAGNATE
On 29th July, Legit in Nigeria reported that a 65-metre Galactica Star superyacht worth $42 million belonging to Kola Aluko – one of 4 defendants accused of cheating Nigeria out of almost $1.8 billion in siphoned crude oil sales – has been sold off by the Nigerian government and the US. Aluko and another oil executive, Olajide Omokore, were also accused by the US Government of laundering money in the US and using it to acquire the yacht, among other assets.
https://www.legit.ng/1251440-fg-us-join-forces-sell-42m-luxury-yacht-belonging-diezanis-ally.html
IRELAND: CORPORATE BENEFICIAL OWNERSHIP: CENTRAL REGISTER NOW OPEN
On 29th July, a briefing from McCann Fitzgerald reported that Irish corporate entities (unless exempted) have until 22nd November to register their beneficial ownership information in the Central Register of Beneficial Ownership of Companies and Industrial & Provident Societies. The Central Register (aka RBO), is now in place, and is accepting online filings through its website.
ARMENIA: BTC BANK FOUNDER KHAZARADZE QUITS ANAKLIA DEEP WATER PORT PROJECT BUT VOWS TO FIGHT MONEY LAUNDERING CHARGES
Ports Europe on 30th July reported that the founders of the bank, Mamuka Khazaradze and Badri Japaridze, said they will step down from their managerial positions at Anaklia Development Consortium (ADC) in order to minimize the harm caused by the ongoing investigation. They serve as CEO and deputy CEO of Anaklia Development Consortium, which is constructing a deep water port on Georgia’s Black Sea coast in the vicinity of the village of Anaklia, a project worth $2.5 billion and seen as strategically important for Georgia and its partners.
TEXAS MAN CONVICTED OF CONSPIRACY TO COMMIT THEFT OF TRADE SECRETS FOR CHINA
A DoJ news release on 29th July announced that Shan Shi, 54, of Houston, was convicted of one count of conspiracy to commit theft of trade secrets. He was originally indicted in June 2017 for conspiracy to commit theft of trade secrets, and a superseding indictment containing one count of conspiracy to commit economic espionage and one count of conspiracy to commit money laundering charges issued in April 2018. Shi was acquitted on the other charges. Shan Shi and his co-conspirators are said to have gone to great lengths to cash in on the Chinese government’s desire to obtain syntactic foam technology. Shi conspired with others to steal trade secrets from a Houston-based company, Trelleborg Offshore, relating to syntactic foam, a strong, lightweight material with commercial and military uses that is essential for deep-sea oil and gas drilling. China has made clear its desire to develop this technology and Shi sought to obtain information about syntactic foam for the benefit of CBM-Future New Material Science and Technology Co. Ltd. (CBMF), a Chinese company based in Taizhou, and for the ultimate benefit of the People’s Republic of China.
https://www.justice.gov/opa/pr/texas-man-convicted-conspiracy-commit-theft-trade-secrets?src=ilaw
ROMANIAN CUSTOMS SEIZE €800,000 WORTH OF FAKE PERFUME, COSMETICS AND APPAREL
On 25th July, Petoevic reported that Romanian customs officials seized 94,525 bottles of perfume, as well as cosmetic products and clothing items believed to infringe numerous trademarks, during raids of warehouses belonging to a commercial centre in the capital of Bucharest.
https://www.petosevic.com/resources/news/2019/07/4164
INNOCENT PARTY ENTITLED TO DAMAGES EVEN THOUGH PERFORMANCE OF CONTRACT WAS IMPOSSIBLE
An article from RPC on 30th July reported that a Court of Appeal case considered the proper interpretation of exceptions or force majeure clauses and provided guidance on the correct application of the compensatory principle of damages. The case involved a shipowner and a charterer who entered into a long-term contract for the shipment of iron ore pellets from Brazil to Malaysia. The charterer failed to make five cargoes available for shipment and claimed to be excused from its obligation to do so by the bursting of a dam in Brazil; and that this event fell under the ‘exceptions’ clause in the contract. The article says that the case provides yet another warning about the need for clarity in drafting contractual clauses and the implications of getting it wrong.
AUSTRALIAN OFFICIALS WHO HELPED CHINESE HIGH ROLLERS OBTAIN VISAS FACE PROBE OVER MONEY-LAUNDERING CLAIMS
The Washington Post on 30th July reported that Australia’s government said it would investigate relations between consular officials and the country’s main casino operator, Crown Resorts, after media reports alleged that organised-crime gangs from China were laundering money through its casinos in Melbourne and Perth. It also said that a former head of the Australian Border Force has told the papers in an article that he had been lobbied by 2 senior government officials to make it easier for wealthy Chinese gamblers to enter Australia on private jets.
WHY THE US WON’T RETURN $500 MILLION ABACHA LOOT AS LONG AS MALAMI IS NIGERIA JUSTICE MINISTER
On 30th July, Sahara Reporters reported that a coalition of civil society organisations has condemned the re-nomination of Abubakar Malami, former Minister of Justice and Attorney General of the Nigerian Federation.
CHARTERED ACCOUNTANTS’ OPINION ON VAT REVERSE-CHARGE FOR BUILDING AND CONSTRUCTION SERVICES
On 29th July, the Institute of Chartered Accountants of England and Wales published an opinion to raise its strong concerns that construction businesses are not sufficiently aware, have not had adequate opportunity to prepare, and are not ready for the introduction of the new VAT reverse charge from 1st October. It says that a start date of 1st April 2020 seems much more appropriate.
SEC CHARGES NEVADA “ENTITY BETTING” OPERATOR WITH FRAUD
On 30th July, Calvin Ayre reported that the SEC had charged Bettor Investments LLC – a defunct Nevada ‘entity betting’ operator with fraud – and its leader Matthew Stuart. The charge involved the alleged fraudulent and unregistered offer and sale of interests in a sports betting venture. Former clients of the company had complained Stuart had failed to deliver on his promises to make them rich by placing sports bets on their behalf and disappearing when they asked for their money back. The company is one that came along after Nevada changed its law in 2015 and allowed out-of-state punters to fund betting accounts through so-called “entity betting operators”, which essentially acted as mutual funds for gamblers, placing bets for the “pool”.
https://calvinayre.com/2019/07/30/business/sec-fraud-charges-nevada-entity-betting-operator/
ARMED MEN STEAL $40 MILLION OF GOLD AND OTHER PRECIOUS METALS FROM BRAZIL AIRPORT
On 29th July, Customs Today reported that armed men stole $40 million of gold and other precious metals from a Sao Paulo cargo terminal at South America’s busiest airport. A police report said the thieves left with about 750 kg of gold and other precious metals.
http://www.customstoday.com.pk/armed-men-steal-40-million-of-gold-metals-from-brazil-airport/
UNDERTAKINGS AS PART OF WORLDWIDE FREEZING ORDERS WILL BE CONSTRUED NARROWLY
On 30th July, The Injunctions Blog carried a post saying that the Commercial Court in London had to consider the interpretation of a standard undertaking given in support of a worldwide freezing order (the WFO) obtained by a Lithuanian Bank, Bank Snoras, against 2 former directors, not to seek to enforce the WFO outside of England and Wales nor to seek an order of a similar nature, and provides clarification as to the scope of the standard undertaking used in support of a WFO.
UK GAMBLING COMMISSION TO HOLD CONSULTATION ON CREDIT CARDS
On 26th July, CMS Law published an article saying that the Gambling Commission will consult on whether or not online operators should be prohibited from taking deposits via credit cards. The consultation will open in mid-August and will run for a period of 12 weeks.
MALTA: CUSTOMS SEIZED €821,000 IN CASH OVER THE PAST 7 MONTHS
On 29th July, Newsbook reported that the Customs Department this year has seized over €821,000 in cash including a €31,390 from a man who was attempting to fly out of Malta with the stash of undeclared cash in the beginning of this month.
MALTA: 4 CONTAINERS OF COUNTERFEIT TOILETRIES SEIZED BY CUSTOMS DEPARTMENT
On 30th July, Newsbook reported that officials from the intellectual property division have seized thousands of counterfeit items discovered in 4 containers at the Malta Freeport. 110,172 counterfeit items were intercepted, including shampoo and perfume, with 41,436 empty bottles were also found, to be filled with lower quality perfume.
ALIBABA WILL LET AMERICAN COMPANIES SELL ON ITS SITE
In a FIATA e-flash on 29th July, it was reported that Chinese internet site Alibaba has said that it is opening up the Alibaba.com platform, allowing US companies to sell their products to small- and mid-sized business buyers around the world. That will help Alibaba (BABA) better compete with Amazon (AMZN) and Shopify (SHOP), which already have a thriving marketplace for large companies to sell to business customers across the globe. Previously, US businesses could buy only on the Alibaba.com platform. Now they can sell to other businesses in the US, China and elsewhere.
https://edition.cnn.com/2019/07/23/investing/alibaba-b2b-us-retailers/index.html
3 THINGS WE WOULDN’T KNOW WITHOUT WHISTLEBLOWERS
On 29th July, the blog from Global Witness carried a post saying that, on National Whistleblower Day, it spotlights 3 cases where people spoke truth to power and exposed wrongdoing in the US. It says such whistleblower protection in the US dates all the way back to 1778, with sailors and marines complaining about the torture of captured British sailors.
https://www.globalwitness.org/en-gb/blog/three-things-we-wouldnt-know-without-whistleblowers/
ITALY GRANTED UN SANCTIONS EXEMPTION TO FUND FOOD SECURITY OFFICE IN PYONGYANG
On 30th July, NK News reported that the UN sanctions committee has granted an exemption allowing transfers to North Korea for an Italian company for food-related work, with over €1 million to be transferred for technical support.
US COURT SAYS THAT VENEZUELA’S CITGO STAKE CAN BE SEIZED
The Wall Street Journal on 29th July reported on a US appeal court decision in which Venezuela’s opposition government has lost out, with a ruling in favour of Citgo creditor Crystallex International, a defunct Canadian gold miner with a claimed $1.4 billion debt, opening the door to a potential sale of the oil refiner. Venezuela’s stake in US-based oil refiner Citgo Petroleum could be seized to satisfy a judgment against the country, dealing a blow to its US-backed opposition government.
https://www.wsj.com/articles/venezuelas-citgo-stake-can-be-seized-appeals-court-says-11564419557
CYBERWARFARE: YESTERDAY, TODAY AND TOMORROW
Defense One in the US has released a series of 3 podcasts on the history, current status and future of cyberwarfare –
Episode 50 – the history – starts with the first major cyber attack on US military networks, and the OPM hack of 2015, then goes back all the way to East Germany in the 1980s, with some brief stops in Hollywood, where a few films over the past 35 years got cyber risks you might say helpfully wrong, while others got various key elements uncomfortably right. Included in a timeline of events from 1986;
Episode 48 – today – takes a look at the number of known cyber attacks in 2019 so far, and some trends and findings; and
Episode 49 – tomorrow – turns more toward nation state hackers, with programming teams from America’s so-called great power competitors like China and Russia, as well as the technology race for 5G services that’s playing out across the globe.
https://www.defenseone.com/topic/podcasts/?oref=d-article-topics
HUGE COCAINE BUST IN ITALY WITH SUPPORT FROM EUROJUST
On 30th July, a news release from Eurojust reported that 368 kg of pure cocaine were seized in the Port of Genova, and 3 men of Italian nationality were arrested – 1 (at least) with links to ‘Ndrangheta. The drugs have a street value of €100 million. In addition to the drugs, cash in excess of €950 000 as well as 3 cars and a jammer to block transmission signals were seized. The drugs were acquired in Colombia and transported and tracked during the journey by the Colombian authorities, the DEA, the US CBP, the French authorities, the Spanish authorities and the Italian Guardia di Finanza Genova and Direzione Anti-Mafia of Genova, with the constant support of Eurojust.
http://www.eurojust.europa.eu/press/PressReleases/Pages/2019/2019-07-30.aspx
GERMAN LAW TARGETS MONEY LAUNDERING IN PROPERTY MARKET
Deutsche Welle on 30th July reported that the government is unveiling a new law aimed at combating money laundering in the real estate sector, saying that the draft Bill will bring Germany in line with “the highest international standards in the fight against money laundering”. Among other changes, it will give the government’s FIU greater powers and access to the data of other investigative authorities.
https://www.dw.com/en/german-law-targets-money-laundering-in-property-market/a-49814156
UK CHARITIES REPORT LOSSES OF £8 MILLION TO FRAUD
The Charity Times on 30th July reported that charities have lost almost £8 million as a result of fraud, according to figures from Action Fraud, obtained by RSM via a freedom of information request. Employee fraud accounted for the highest level of fraud losses, followed by abuse of a position of trust and mandate fraud.
http://www.charitytimes.com/ct/charities-report-losses-of-8m-to-fraud.php
DELHI BANS FOR 3 YEARS WORLD’S LARGEST BREWER, ANHEUSER-BUSCH INBEV, FOR ALLEGED TAX EVASION
The Indian Express on 30th July reported that the Delhi city government alleged that the company evaded state taxes by using same barcodes on bottles-order, even as AB InBev denied those allegations. It has banned the brewer from selling its products in the key New Delhi market for 3 years, and called for the sealing of two of AB InBev’s warehouses in the capital city.
MICRONESIAN GOVERNMENT OFFICIAL SENTENCED TO PRISON FOR ROLE IN MONEY LAUNDERING SCHEME INVOLVING FCPA VIOLATIONS
A DoJ news release on 30th July reported that a Micronesian government official was sentenced to 18 months in prison followed by 3 years of supervised release for his participation in a money laundering scheme involving bribes made to corruptly secure engineering and project management contracts from the government of the Federated States of Micronesia. Master Halbert, 44, a Micronesian citizen, was sentenced in Honolulu.
ROLLS-ROYCE AND ITS INDIAN SUBSIDIARY IN CORRUPTION CASE
The Scroll website in India on 30th July reported that the car maker allegedly engaged the services of an Indian agent who paid bribes to get it contracts from public sector companies. It is reported that the Central Bureau of Investigation has filed a case against Rolls-Royce and its Indian subsidiary.
US STATE DEPARTMENT DESIGNATES ALBANIAN MAYOR FOR INVOLVEMENT IN “SIGNIFICANT CORRUPTION”
A news release from the State Department on 30th July says that the Department has named the Albanian Mayor of Durres, Vangjush Dako, due to his involvement in significant corruption.
BAHAMAS GOVERNMENT TO ASSIST HAITIAN OFFICIALS IN VISA CORRUPTION INQUIRY AT EMBASSY
The Nassau Guardian on 30th July reported that the government of The Bahamas will assist the Haitian government in its inquiry into concerns of corruption at the Haitian embassy in Nassau. The Nassau Guardian has reported that 5 people were accused of conducting a fraudulent marriage scheme aimed at getting status for Haitian immigrants.
https://thenassauguardian.com/2019/07/30/govt-to-assist-haitian-officials-in-corruption-inquiry
REPORT SUSPICIOUS BEHAVIOUR AT THE UK BORDER: PROJECT FALCO
A news release from Border Force on 30th July says that Project Falco is the name given to a joint law enforcement operation tackling border crime to the UK. The guide provided explains how you can report suspicious and unusual behaviour around ports and rail terminals.
UPPER TRIBUNAL GUIDANCE ON WITNESS EVIDENCE IN MISSING TRADER (MTIC) VAT FRAUD CASES
On 30th July, Out-Law published a briefing reporting that the Upper Tribunal has confirmed that inadmissible opinion evidence need not be struck out or redacted from witness statements in tax tribunals as the tribunals can admit evidence which would not be admissible in a court and can give it the weight they consider it is worth. It has said that where a taxpayer advances no positive case on tax loss issues and simply puts HMRC to proof, it can only require HMRC witnesses to attend the hearing for cross examination if it has identified passages in witness statements it does not accept – but the taxpayer does not need to say why. The article says that it will be interesting to see whether, in practice, taxpayers indicate that they do not accept large parts of HMRC’s witness evidence and where the Tribunal draws the line in terms of imposing costs sanctions; and the decision emphasises the importance of ensuring that witness statements contain only matters that are strictly relevant.
US ARMS SALES TO SAUDI ARABIA
The Center for International policy in the US has published a report which covers arms offers to Saudi Arabia that have been officially notified to the US Congress from 2009 to May 2019. 4 companies analysed in the report – Raytheon, Lockheed Martin, Boeing, and General Dynamics – were involved in the majority of arms offers notified to Congress from Fiscal 2009 through May 2019. In all, the 4 companies were involved in 27 offers worth over $125 billion, out of a total of 51 offers to Saudi Arabia worth $138 billion. In other words, over 90% of US arms offers to Saudi Arabia by value involved one of the top 4 supplying companies. It says that company officials have largely dodged responsibility, moral or otherwise, for the actions of their Saudi clients in Yemen, arguing that they are just following US government policy.
https://raytoddblog.files.wordpress.com/2019/07/9d7ae-fb6c59_bd62e10ae7b745069e9a6fa897de6a39.pdf
ARIZONA MEN ARRESTED FOR ALLEGEDLY TRYING TO TRAVEL TO JOIN ISIS IN SINAI
On 29th July, Homeland Security Today reported that Ahmed Mahad Mohamed and Abdi Yemani Hussein had been arrested for conspiring to provide material support and resources to ISIS, a designated foreign terrorist organisation. It is alleged that the defendants had been in communication with an FBI undercover employee whom they believed was a supporter of ISIS ideology.
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