THINGS YOU MAY HAVE MISSED – SEPTEMBER 24

24 September 2019

Global Corruption Barometer 2019 from Transparency International) shows that 56% of Panamanian citizens believe that corruption has increased in the last 12 months

MENA-FN said on 24 September that the report shows that institutions, where Panamanians paid the most bribes, were the police with 29% and in public services with 14%, which coincides with the regional trend; and that in Panama more than $10 billion have been lost due to corruption. 

https://menafn.com/1099042404/Panama-cops-most-bribed-as-corruption-expands

Additional Huawei Affiliates Added to Entity List and other developments

On 23 September, an article from Baker Hostetler reported on additional actions by the US targeting Huawei Technologies Co Ltd  and its affiliates. These add more non-U.S. affiliates of Huawei to the Entity List – causing export and related controls, revise and extend the Temporary General License (TGL) issued in May, and provide additional clarification on the licensing policy of the Bureau of Industry and Security of the Department of Commerce (BIS) as it relates to exports to Huawei and its designated affiliates.  In August, another measure prohibits federal agencies from procuring or obtaining, or extending or renewing a contract to procure or obtain, any equipment, system or service that uses telecommunications or video surveillance equipment or services produced by certain Chinese companies (including Huawei, any Huawei subsidiary or any Huawei affiliate) as a substantial or essential component of any such system, or as a critical technology that is part of any such system, unless an exception applies or a waiver has been granted.

https://www.bakerlaw.com/alerts/additional-huawei-affiliates-added-to-entity-list-bis-updates-temporary-general-license-and-issues-faqs-dod-prohibits-federal-agencies-from-obtaining-huawei-equipment

13 people arrested for money laundering in New Zealand over “sophisticated” phone scam

Indian Newslink on 24 September reported that since July police have arrested 13 people for money laundering and are actively searching for 3 more people of Indian origin thought to be involved, as investigations continue into an ongoing sophisticated phone scam that has seen New Zealander’s lose millions of dollars.

http://www.indiannewslink.co.nz/thirteen-people-arrested-for-money-laundering-in-new-zealand/

IMF: tax havens accumulate 8% of world GDP   

ANF News on 24 September reported that a recent report of the IMF says that the capital accumulated in the so-called tax havens amounts to approximately $7 billion, the equivalent of 8% of the global GDP.  

https://anfenglish.com/news/imf-tax-havens-accumulate-8-of-world-gdp-37839

SEC Charges Adult Entertainment Token Platform With 2017 ICO Fraud   

On 24 September, Coindesk reported that the SEC had charged Jonathan Lucas, 27, the CEO of online adult entertainment marketplace – Fantasy Market (described as a role-playing performance marketplace for live, client-controlled digital performances), with running a fraudulent initial coin offering (ICO) scheme.  It says that all the team members in the company are fictional except for Lucas, according to the complaint, which listed many false statements made by the company in promoting its ICO. It says that, in a 6-week period, Fantasy Market raised about $63,000 in cryptocurrency from more than 100 investors in its fraudulent offer and sale of unregistered digital securities — CEO Lucas actually claimed to the press he had raised $2 million towards the $25 million goal.

https://www.coindesk.com/sec-charges-adult-entertainment-token-platform-with-2017-ico-fraud

Bulgarian-French human trafficking network exploiting vineyard workers

On 23 September, a news release from Europol reported that Bulgarian and French law enforcement authorities, supported by Europol, dismantled an organised crime group involved in trafficking human beings for labour exploitation and money laundering. More than 80 investigators from Bulgaria and France were involved in the action day. Investigations led to the identification of 167 potential victims, employed by 4 different winegrowing companies near the French city of Lyon.  An organised crime group operated behind a legal business, an employment agency based in Bulgaria and recruited Bulgarian nationals from disadvantaged regions as seasonal workers for the French agricultural sector. 

https://www.europol.europa.eu/newsroom/news/bad-harvest-for-bulgarian-french-network-exploiting-vineyard-workers

Philippines Customs Bureau Declares Tough Crackdown on Imported Steel

Scrapmonster on 23 September reported that the Philippines Bureau of Customs has announced implementation of tough crackdown on steel imports into the country, and that the move comes in the midst of reports that undervalued and substandard steel imports are flooding the country’s local market – and with stringent inspection of all steel shipments into the country through the Port of Manila (PoM) and the Manila International Container Port (MICP).

https://www.scrapmonster.com/news/philippines-customs-bureau-declares-tough-crackdown-on-imported-steel/1/72811

South Korea Justice Minister’s Home Raided In Corruption Investigation

Baker McKenzie on 23 September reported that South Korean prosecutors raided the home of Justice Minister Cho Kuk, the Yonhap News Agency reported, as part of a widening corruption investigation that has already dented support for President Moon Jae-in.

http://www.riskandcompliancehub.com/south-korea-justice-ministers-home-raided-in-corruption-investigation/

US Treasury Further Targets Entities and Vessels Moving Venezuelan Oil to Cuba – while delisting others

On 24 September, OFAC added 4 entities and 4 vessels to its sanctions lists.  Caroil Transport Marine Ltd, based in Cyprus, and its 3 vessels – Carlota C, Sandino; Petion; Trocana World Inc, based in Panama and registered owner of the Petion; Tovase Development Corp, based in Panama and registered owner of Sandino; Bluelane Overseas SA, based in Panama and registered owner of Giralt.  

OFAC also delisted Serenity Maritime Limited, Lima Shipping Corporation, the vessels Leon Dias and New Hellas, and an aircraft, N133JA.

https://home.treasury.gov/news/press-releases/sm784

https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20190924.aspx

London-based TechnipFMC Agrees to Pay $5.1 Million in Foreign Bribery Case 

The Wall Street Journal on 24 September reported that London-based oil-and-gas services company also agreed to improve its compliance with anti-corruption laws in a deal with the SEC.  The charges stem from $794,000 in payments made between 2008 and 2013 by FMC Technologies Inc., a predecessor company to TechnipFMC, to an unnamed third-party consultant.

https://www.wsj.com/articles/technipfmc-agrees-to-pay-5-1-million-in-foreign-bribery-case-11569273161

Iran to bring charge at International Court of Justice over sanctions on space agency

On 24 September, the EU Sanctions blog reported that Iran is to bring a case before the ICJ over OFAC targeting ISA, the Iran Space Research Centre and the Astronautics Research Institute on the grounds that Iranian space technology can be used for the advancement of a ballistic missile programme. 

https://www.europeansanctions.com/2019/09/iran-to-bring-icj-claim-against-us-over-space-agency-sanctions/

New Relief Procedure for Certain Expats Who Have Relinquished, or Intend to Relinquish, Their US Citizenship

On 16 September, law firm Dickinson Wright published an article about the procedures for certain persons who have relinquished, or intend to relinquish, their US citizenship and who wish to come into compliance with their US income tax and reporting obligations and avoid being taxed as a “covered expatriate” under the Internal Revenue Code – if they satisfied the other conditions and criteria involved.

https://www.jdsupra.com/legalnews/new-relief-procedure-for-certain-expats-94439/

Will the country evaluation by FATF recognise the South African judiciary’s contribution regarding effectiveness?

On 4 September, an article from Cliffe Dekker Hofmeyer discussed if a case in August before the High Court would affect the onsite FATF inspection scheduled for October/November, and with the possible Plenary discussion regarding the Mutual Evaluation Report (MER) scheduled for June 2020.  It also discussed the possible effects of the evaluation and corruption in more general terms, given the country’s recent performance and scandals. The article concludes that recent developments, like the recent case, may not affect the outcome of the evaluation.  However, it says that the country has an opportunity to prove effectiveness in producing the required outcomes that FATF seeks. In doing so, returning to the rule of law and eradicating corruption, and thus that South Africa will resume its place as a leading African state.

https://www.cliffedekkerhofmeyr.com/en/news/publications/2019/Dispute/dispute-resolution-alert-4-september-Will-the-country-evaluation-by-the-financial-action-task-force-recognise-the-South-African-judiciarys-contribution-regarding-effectiveness.html

Finland: Croatian millionaire’s Afarak Group fined over insider trading

On 24 September, Uutiset reported that Finland’s Financial Supervisory Authority (FIN-FSA) has fined the Afarak Group nearly €1.5 million for violations related to insider trading.  The Finland-based company is a specialty alloys producer which has operations in Germany, Malta, Turkey and South Africa. It reports that FIN-FSA has intervened in Afarak’s operations in the past, and fined its COO and principal owner, and former CEO, before, most recently in June, when it ordered him to pay accrued supplementary fines of €110 million.

https://yle.fi/uutiset/osasto/news/croatian_millionaires_afarak_group_fined_over_insider_trading/10986905

Esposito brothers running US Coin Bullion agree to plead guilty to wire fraud

Finance Feeds on 24 September reported that brothers Salvatore Esposito and Joseph Esposito have agreed to plead guilty to conspiracy to commit wire fraud and mail fraud.  It says that instead of using the customers’ funds to purchase precious metals as had been promised, the Espositos used customer funds to pay other customers, to pay commissions and other business expenses, and to purchase silver for the company itself.

https://financefeeds.com/esposito-brothers-running-u-s-coin-bullion-agree-plead-guilty-wire-fraud/

AML compliance burden on UK financial institutions intensifies as new rules on third country local law conflicts bite 

On 24 September, Eversheds Sutherland published an article saying that additional EU rules have come into force requiring UK credit and financial institutions with branches and subsidiaries in third countries to identify local law conflicts with group-wide AML policies and procedures, and taking a look at these new technical standards including application, scope, and FCA notification requirements.  This was under a new EU Regulation which came into effect on 3 June.

https://www.lexology.com/library/detail.aspx?g=91c0cae1-4b82-4f1e-9a7a-b7151c2d1825

Anti-Corruption Enforcement in Mexico:  A Possible Turning Point?

A blog post from the Program on Corporate Compliance and Enforcement at New York University said that Mexico adopted a new National Anti-Corruption System in mid-2016, when many hoped Mexico would seize the opportunity and shortly thereafter pursue significant anti-corruption enforcement.  But key posts within the anti-corruption system remained unfilled, and no significant enforcement ensued. When a new President took office in December 2018 and filled a number of significant positions, including appointing Mexico’s first-ever independent Attorney General, who in turn appointed a Special Anti-Corruption Prosecutor, notwithstanding lofty campaign promises, an absence of immediate enforcement along with some of President López Obrador’s public statements tempered expectations about full implementation of the new regime.  The post considers new developments relating to Mexico’s fledgling anti-corruption system, relatively new administration, and recent enforcement developments – as the indication from the Attorney General’s Office is that it will pursue vigorously acts of potential corruption already within that office’s investigative pipeline, but otherwise will focus its investigative efforts on future misconduct. 

https://wp.nyu.edu/compliance_enforcement/2019/09/23/anti-corruption-enforcement-in-mexico-a-possible-turning-point-2/

IMF Predicts Boom Time for Guyana Economy

On 24 September, the St Kitts & Nevis Observer reported that the IMF has projected 4.4% economic growth for Guyana this year, as oil production is on schedule to begin in early 2020, with the oil sector projected to grow rapidly, accounting for around 40% of GDP by 2024.  The IMF also noted the Guyanese authorities’ progress in strengthening the AML/CFT framework and called for further efforts.

http://www.thestkittsnevisobserver.com/regional-intl-news/imf-predicts-boom-time-for-guyana-economy/

Former Danske Bank boss vanishes in wake of billion kroner money laundering scandal

CPH Post online on 24 September reported that Estonian police are concerned that a key figure in the billion-kroner Danske Bank money laundering scandal has disappeared.  Aivar Rehe, 56, headed Danske Bank’s branch in Estonia from 2006 to 2015. Police fear for his well-being and have been searching a wooded area near his house.

http://cphpost.dk/news/business/former-danske-bank-boss-vanishes-in-wake-of-billion-kroner-money-laundering-scandal.html

Isle of Man-based e-gaming giant Stars Group has been fined €400,000 by Dutch gambling regulator

On 24 September, Manx Radio reported that the owner of Pokerstars was fined after it offered online gaming in the jurisdiction but did not have the required licence.  

https://www.manxradio.com/news/isle-of-man-business/iom-based-e-gaming-giant-fined/







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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