23rd August 2019
SPANISH POLICE UNCOVER CRIMINAL NETWORK THAT SMUGGLED EXOTIC ANIMALS FROM EUROPE TO AFRICA
On 22nd August, Euro Weekly reported on the seizure of nearly 200 animals by police in Spain, amongst them exotic birds, mammals and reptiles. Most of the animals were being kept in the Costa del Sol resort town of Fuengirola and the inland town of Ronda in Andalucia. They were being smuggled illegally from Europe to Morocco and then on to other African countries. It says that the investigation uncovered for the first time the existence of an emerging market in Africa which, through Morocco, demands a large quantity of exotic animals that are illegally imported, mainly birds and reptiles.
US CUSTOMS SEIZE OVER 52,000 GUN PARTS SHIPPED FROM CHINA
On 22nd August, the Long Beach Post and others carried a report that Customs had seized more than 52,000 gun parts shipped from China in 3 shipments to the Los Angeles-Long Beach port complex.
EU SET TO LAUNCH NEW MONEY LAUNDERING BLACKLIST
Quartz on 22nd August reported that the EU Justice Commissioner plans to launch a new list with a new methodology, drawn up in conjunction with the Member States that vetoed the old one in February. It is possible that, with the UK about become a non-EU state, its various territories might be included on the new list – whereas EU Member States and their territories were excluded from the vetoed list.
UK LOCAL COUNCILS URGED TO PROTECT THEMSELVES AGAINST MONEY LAUNDERING
On 22nd August, the Room 151 blog carried a post saying that the Chartered Institute of Public Finance and Accountancy (CIPFA) has urged councils to ensure that they have the right procedures in place to protect against sophisticated financial crime. It is reported that in 2013 an estimated £2.1 billion of financial crime was perpetrated against local government in the UK. Councils have been updating their procedures to ensure they are protected and are highlighting the risk to officers of unwittingly enabling cash to be legitimised. It is said that critical issues can be signing rent contracts on housing properties where the landlord is running a front company to launder drug money. CIPFA urged councils to be proactive and not presume money laundering is not an issue for local government.
MANY SWISS PRIVATE BANKS FACING ‘EXTINCTION’
On 23rd August, KYC 360 reported that a third of banks are struggling to make ends meet in the face of adverse conditions. An annual health check of the sector has forecast that smaller players could be “driven to extinction”. A study of 87 private banks by consultants KPMG and the University of St Gallen says that 34% were “weak” performers in 2018 – a 50% increase from 2017, with more than half of this category operating at a loss last year.
ERDOGAN SAYS TURKEY TO PRESS AHEAD WITH GAS SEARCH OFF CYPRUS
On 23rd August, EurActiv reported that Turkish President Recep Tayyip Erdoğan has hit out at EU measures to punish Turkey for drilling activities in the eastern Mediterranean and vowed to press ahead with gas search in the region.
FORMER ROMANIAN TAX AGENCY HEAD AND OTHER OFFICIALS SENT TO COURT FOR BRIBE TAKING
Romania Insider on 23rd August reported that the former head of Romania’s tax collection agency (ANAF), Sorin Blejnar, former deputy director Viorel Comăniţă and former deputy commissioner-general of the Financial Guard Sorin Florea, were sent to court by prosecutors of the National Anticorruption Directorate (DNA) on bribery charges linked to a company that had been trading fuels but never paid the excise duties.
PARAGUAY’S PRESIDENT ESCAPES CORRUPTION CHARGE
The Rio Times on 23rd August reported that a motion brought to the Chamber of Deputies by the opposition in the wake of a scandal over an energy agreement with Brazil was voted down. The motion named President Mario Abdo Benitez, Vice-President Hugo Velázquez, and Finance Minister Benigno López, the President’s half-brother.
TAX ABUSE USING COMPANY INSOLVENCIES – JOINT AND SEVERAL LIABILITY OF COMPANY DIRECTORS ETC
On 22nd August, the Chartered Institute of Taxation published a response to a consultation on draft legislation in the UK Finance Bill about measures intended to tackle the small minority of taxpayers who unfairly seek to reduce their tax bill by misusing the insolvency of companies.
MALAYSIA LAW ENFORCEMENT TARGETING ONLINE GAMBLING
On 23rd August, Calvin Ayre reported that police recently took down a large illegal online gambling site that saw 100 people being sent to jail – 83 men and 17 women – all Chinese nationals – were arrested. According to reports, the leaders of the operation had restricted the workers’ movements and kept them indoors. The article says that Malaysian police are taking their action against illegal online gambling very seriously, having made 22,000 arrests last year as a result of 10,000 raids and in March led another raid against an illegal gambling den. All of SE Southeast Asia is cracking down on online gaming, especially if it involves Chinese nationals.
SOUTH KOREA CUSTOMS CRACKDOWN ON ILLEGAL FOREIGN EXCHANGE ACTIVITY IN MALAYSIA INVOLVING “HWANCHIGI”
On 23rd August, Customs Today reported that the Korea Customs Service has cracked down on 146 individuals who purchased a country house in Johor Bahru, a popular tourist destination in Malaysia and other costly real estate using an illegal foreign exchange method commonly known as “hwanchigi”. They purchased stores, condominiums, and country houses without reporting the transactions to customs. It is said that it was made possible with the help of a construction company employee in Malaysia, which received the salaries for South Korean laborers sent to Malaysia in local currency and used them to pay for the investments made to purchase the real estate.
JERSEY: COURT ORDERS FRAUDSTER WHO STOLE AFTER DEATH OF BUSINESS PARTNER TO PAY £320,000
The Jersey Evening Post on 23rd August reported that a fraudster who plundered hundreds of thousands of pounds from a Jersey company following the death of a business partner has been ordered to pay £320,000 or face 3 more years in prison. Russell Stephen King (60) was jailed for 6 years earlier this year after pleading guilty to 5 counts of fraud.
TAJIK OFFICIAL ARRESTED FOR EMBEZZLING PENSION FUND MONEY
On 22nd August, OCCRP reported that Tajik authorities detained Bakieva Zarina Dzhamakhonovna, the deputy head of the country’s Social Insurance and Pensions Agency, accusing her of having appropriated more than $100,000.
THE TREATMENT OF CRYPTOTOKENS IN ENGLISH LAW
On 21st August, the Faculty of Law at Oxford University published an article saying that the UK Jurisdiction Task Force (UKJT) is one of the 6 taskforces formed with the aim of ensuring that English law and the jurisdiction of England and Wales together provide a robust foundation for the development of DLT, smart contracts, and associated technologies. It is coordinating the preparation of an authoritative legal statement on the status of cryptoassets and smart contracts under English private law. The relevant consultation was launched in May, see –
It also refers to a paper published by law firm Clifford Chance on 30th July which sets out to establish what the law is as regards a significant commercial activity involving cryptotokens and discusses this and the relevant existing frameworks under English law.
FATF-STYLE BODY APG ANNUAL MEETING IN AUSTRALIA
The Asia-Pacific Group on 23rd August reported on its 22nd annual meeting held in Canberra 18th to 23rd August when 520 senior delegates from 46 jurisdictions and 13 international organisations came together. Members adopted 6 significant mutual evaluation reports – for China, Chinese Taipei (Taiwan), Hong Kong, China, Pakistan, the Philippines and Solomon Islands – which were also analysed and discussed in detail. Detailed information on these is expected in October. Members also adopted a CFT Operational Plan as part of a global strategy to address the concerns related to terrorist financing – as part of this plan, the plenary agreed to undertake a typologies and implementation project examining the financing and facilitation of foreign fighters and returnees. Members agreed a new project to develop a workshop to be held in early 2020 on the application of FATF Guidance on Digital KYC to the Asia Pacific region following its adoption/publication by the FATF in February 2020. The meeting adopted 2 typologies reports – an APG/EAG report on Terrorism Financing & Proceeds of Crime (including Organised Crime) which identifies techniques and trends associated with the use of proceeds of crime including from organised crime for financing terrorism; and the 2019 APG Yearly Typologies Report, which includes approximately 135 cases received from 19 member jurisdictions and APG observers.
AMERICAN AIRLINES SETTLES $22.1 MILLION FINE FOR FALSE MAIL DELIVERY REPORTS
On 21st August, American Shipper reported that the DoJ said that the settlement stems from allegations that the airline falsely reported times it transferred US mail to foreign postal services.
BELGIAN COMPANIES INCREASINGLY PAYING INTO ‘TAX HAVEN ACCOUNTS’
Brussel Times on 21st August reported that €82 billion in 2016, €129 billion in 2017, €206 billion in 2018: according to figures, Belgian companies are making more and more payments to accounts in countries recognised as tax havens by Belgium. Belgian law requires companies making payments of €10,000 and upwards into tax haven accounts to include them in their tax declarations. A tax official is quoted as saying that most of the money sent by Belgian banks to tax havens come back later, but as there is no obligation to declare the inflows, it is not known precisely what is going out of Belgium.
US COAST GUARD ON LONG PATROL AGAINST ILLEGAL FISHING IN NORTH PACIFIC
An article in National Fisherman on 22nd August reports on a 50-year-old US Coast Guard cutter is on the front line against illegal fishing on the high seas of the North Pacific, part of a growing international fight. In the North Pacific, there is what is called the North Pacific Fisheries Commission, which regulates fishing in international waters. It only started in 2015 and includes representation from Canada, China, Japan, South Korea, Russia, Taiwan, US and Vanuatu. The cutter has been enforcing international fisheries agreements and protecting marine resources on behalf of the NPFC. Since June, the crew has conducted 40 boardings and issued 61 citations. The most frequent violations were 9 cases of improper vessel identification marking, 4 cases of illegal shark finning, and 2 instances when boarding teams found vessel monitoring systems were not being used properly or had been tampered with.
AS SANCTIONS ESCALATED, DPRK BEEFED UP FUEL STORAGE FACILITIES
NK Pro reported on 22nd August that North Korea added fuel storage capabilities at another site near its Nampho oil terminal sometime in the second half of 2017, satellite imagery shows, adding to the already large-scale upgrades taking place in the region as the UN escalated sanctions against the country.
ANTI-CORRUPTION BOOST AS SOUTH AFRICA ARMS DEAL INQUIRY SET ASIDE
On 23rd August, defence Web reported that the High Court had set aside the findings of the Seriti Commission of Inquiry into the Strategic Defence Procurement Package. The judgment is a victory for civil society groups that have been part of a decades-long campaign for some form of accountability after the deal that dates back to 1999. The article says that The Commission, appointed by former president Jacob Zuma in 2011, was to investigate ‘allegations of fraud, corruption, impropriety or irregularity in the strategic defence procurement package’. However, the article says, it was patently clear to most objective observers that chairman Judge Willie Seriti was unwilling to find any evidence of corruption and its witnesses implicated in corruption were rarely cross-examined while those presenting evidence were vigorously grilled. Despite 2 men being convicted for corruption related to the arms deal, and foreign arms companies paying many millions of dollars and euros in fines to their home countries for irregularities related to graft, Seriti found ‘not one iota of corruption’.
TUNISIA ARRESTS MEDIA MOGUL PRESIDENTIAL CANDIDATE
Deutsche Welle on 23rd August reported that Media mogul Nabil Karoui is one of the top contenders in presidential race in September. His TV channel has also been banned. He is facing charges of tax evasion and money laundering.
US: POWERFUL CATHOLIC GROUP IS FACING ALLEGATIONS OF INSURANCE FRAUD
On 23rd August, Buzz Feed reported that the Knights of Columbus are being accused of inflating their membership numbers to appear more profitable to insurance companies. A lawsuit accuses the Knights of Columbus of “racketeering, fraud, deception, theft, and broken promises”.
UK: TELLING PEOPLE ABOUT YOUR CRIMINAL RECORD
On 23rd August, the MoJ published updated guidance which helps you work out what information to give people if they ask about your criminal record.
3 AIRLINES IMPLICATED IN MEXICO CITY AIRPORT CUSTOMS CORRUPTION
Mexico News Daily on 22nd August reported that a criminal network involving customs agents is under investigation at Mexico City airport. The airlines involved are Cargolux of Luxembourg, Cathay Pacific Cargo of Hong Kong and Panalpina of Switzerland. It is claimed that customs authorities identified the airlines as smugglers of counterfeit goods during an inspection operation carried out in April. Authorities are also said to have identified 3 warehouses where the pirated goods are stored prior to dispatch and seized over 45 tonnes of counterfeit goods including clothes, shoes, watches, jewellery, bags and mobile phone accessories.
CHINESE MAFIA EXPANDING IN ARGENTINA
An article in Insight Crime on 23rd August reports a possible expansion of the mafia’s criminal tactics in Buenos Aires and the difficulties authorities are facing in stopping it. The impunity with which Chinese criminal groups have handled extortions and violent attacks of late show that they are expanding their modus operandi – which used to be limited to only targeting stores and businesses owned by the Chinese community.
TIMEFRAME FOR INVESTIGATIONS INTO SWEDISH BANKS’ MANAGEMENT OF MONEY LAUNDERING RISKS
A release on Mondo Visione on 23rd August announced that the Swedish regulator sent notification letters to SEB and Swedbank as part of the investigations into the banks’ management and control of money laundering risks in Estonia, Latvia and Lithuania. SEB and Swedbank must respond to the notification letters no later than 2nd September and 16th September, respectively.
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