9th October 2019
CHAIR OF JAPAN NUCLEAR OPERATOR TO RESIGN OVER $3 MILLION GIFT SCANDAL
On 9th October, Nikkei Asian Review reported that the chairman of Kansai Electric Power, Japan’s second-largest listed utility by revenue, intends to resign over $3 million in undisclosed cash and gifts received by company executives over the years.
FBI WARNS US UNIVERSITIES ABOUT CHINESE THEFT OF INTELLECTUAL PROPERTY
The Campus Safety website on 8th October reported that the FBI has been working to stop the theft of technology and trade secrets by Chinese researchers who are working at US institutions of higher education, with outreach efforts to universities include lecturing at seminars, briefing campus administrators and providing information on intellectual property theft. Earlier this year, 2 bodies published a sample of some of the best practices being implemented by universities to combat emerging security threats and encouraged all universities to review the examples and consider implementing them on their campuses.
US TREASURY PROPOSES 2 CFIUS RULES IMPLEMENTING FIRRMA
On 8th October, Davis Wright Tremaine LLP published an article about 2 proposed rules published in September concerned with the process whereby the US authorities review foreign investments in the US from the aspect of national security –
- expanding the Committee on Foreign Investment in the United States (CFIUS) rules to include certain non-controlling investments by foreign persons in US businesses involving critical technology, critical infrastructure, or sensitive personal data;
- including certain transactions with foreign persons involving real estate in close proximity to US military and other sensitive national security facilities; and
- modernising the CFIUS review process.
The article examines each of the proposals in more detail.
https://www.jdsupra.com/legalnews/treasury-department-proposes-two-cfius-53358/
CHINA MASKS OIL IMPORTS VIA SHIP TRANSFERS AS US SANCTIONS BITE
Yahoo Finance on 9th October published an article which claims that Chinese oil imports from ship-to-ship transfers surged last month, with some 910,000 tons of crude, 3 times as much as in August, said to have been offloaded at Chinese ports after being transferred in the South China Sea. Imports from Malaysia rose to make it the seventh-biggest supplier to China, up from 16th in August and much of that oil has also been transferred at sea. Some of the oil coming from Malaysia may be from Venezuela, one analytics company is reported to have said.
https://finance.yahoo.com/news/china-oil-imports-ship-ship-093940671.html
NAVIGATING THE RECENT U.S. SANCTIONS ON COSCO AND OTHER CHINESE COMPANIES
On 8th October, Holland & Knight published an article saying that unlike past designations, OFAC neither identified specific vessels nor provided guidance or wind-down general licences that would have eased the disruption caused by such a major action, and that resolution of these designations is likely a bargaining chip in the larger trade negotiations between the US and China. The article looks at who/what are the targets of the sanctions and the implications. It goes on to examine what companies can do to mitigate the risks. It says that in-depth research is necessary to determine who owns particular counterparties, taking steps to wind-down or terminate contracts, or other actions. For many companies, it contends, the commercial risks from breach of contract and the inability to enter into new agreements are likely to be the greatest problems.
ISRAEL SEIZES 69 ANCIENT GREEK COINS BEING SMUGGLED FROM GAZA
On 8th October, the Jerusalem Post reported that 69 ancient and rare coins from the period of Alexander the Great were found being smuggled from the Gaza Strip through the Keren Shalom crossing a truck that was transporting textile products from Gaza into Israel.
CANADIAN PROBE OF BOMBARDIER BUSINESS ACTIVITIES IN AZERBAIJAN TO INCLUDE ALLEGATIONS OF MONEY LAUNDERING
On 8th October, the Globe & Mail in Canada reported that the investigation into the aircraft and train producer had been expanded to encompass allegations of money laundering.
EU AML/CFT PRIORITIES TO BE DEBATED
On 7th October, a briefing from Hogan Lovells said that the Presidency of the Council of the EU had issued a note which sets the agenda for the ECOFIN EU Council meeting observing that Member States need to consider the scope of possible future actions on AML/CFT. The relevant legal framework has been substantially enhanced in the last few years. The note observed that Member States need to consider the scope of possible future actions on AML/CFT, and has therefore noted several issues should be discussed at the EU Council meeting on 10th October. These issues included the most appropriate scope of further reforms, the need for further harmonisation and co-operation, and if a new EU body was required.
WHEN IS A SIGNATURE NOT A SIGNATURE? THE LAW COMMISSION REPORT ON THE ELECTRONIC EXECUTION OF DOCUMENTS
On 30th September, Wilberforce Chambers published an article following the 4th September UK Law Commission report on the use of electronic signatures. The article says that the report reflects the lack of certainty which permeates this topic. This lack of certainty includes when dealing with vulnerable individuals, for example in connection with Lasting Powers of Attorney, and the risk of fraud, particularly when dealing with property held in trust. It is said that the Law Commission has not fully resolved these issues.
PROFESSIONAL E-SPORTS IN LATIN AMERICA
On 31st August, CMS Law published a briefing saying that esports are taking off in Latin America, with the recent creation of national leagues in Chile, Peru, Argentina, Mexico and Colombia, and a Mexican TV company looking to acquire a sports production company with the aim of launching a 24-hour esports channel. It asks how are tax regimes dealing with the new business models and income streams generated by the boom in esports – looking at the tax rules for esports players and industry participants in Colombia, Chile, Mexico and Peru.
https://cms.law/en/INT/Publication/Professional-esports-is-taxing
UK: MOVEMENT OF CITES SPECIMENS AFTER BREXIT
On 8th October, BIFA said that more than 35,000 CITES-protected species, as well as their products, will require action in order to move between the UK and EU, and permits will be required to move protected plants and animals between the UK and the EU. BIFA has prepared a “get ready” leaflet –
https://www.bifa.org/media/4387607/cites-get-ready-leaflet.pdf
EX-COLOMBIA PRESIDENT URIBE TESTIFIES OVER WITNESS TAMPERING AND BRIBERY
Al Jazeera on 9th October reported that Alvaro Uribe is accused of trying to bribe members of a paramilitary group who had damaging information against him. A magistrate queried Uribe, president 2002-2010, behind closed doors for over 7 hours. After the questioning, the court released a brief statement announcing that officials had concluded there were sufficient grounds to continue investigating Uribe, though no charges have been filed.
US OFFICIAL: SEYCHELLES MUST IMPROVE OFFSHORE BANKING TO DETER TERRORIST AND DRUG MONEY
On 9th October, the Seychelles News Agency reported that the Assistant Secretary for Terrorist Financing at the US Treasury said that the Seychelles need to raise awareness on the risks associated with off-shore banking and set up legislation to fix loopholes within financial regulatory systems. Following meetings on the islands, he also said that that awareness needs to be raised in particular on “establishment of off-shore shell companies without an effective beneficial ownership registry”, and that it needs to introduce new legislation to fix the “enormous” loophole in the current laws.
AUSTRALIA: CLAIM THAT FORMER NSW LABOR BOSS RECEIVED $35,000 IN WINE BOX FROM CHINESE BILLIONAIRE
ABC News on 9th October reported that the Independent Commission Against Corruption (ICAC) is examining allegations Huang Xiangmo, a property developer. Former NSW Labor boss, Jamie Clements, has the inquiry that Huang Xiangmo gave him $35,000 hidden in a wine box to pay his legal fees. He says he did not think it was unusual because Mr Huang had paid the legal fees of former Labor senator, Sam Dastyari.
IRELAND ADOPTS LLP – AND A NEW COMPLAINTS REGIME FOR BARRISTERS AND SOLICITORS
On 8th October, the Law Society Gazette reported that Limited liability partnerships will become available for lawyers in Ireland following the implementation of regulatory reforms under the 2015 Legal Services Regulatory Authority Act, which also transfers responsibility for complaints handling from representative bodies to the new Legal Services Regulatory Authority.
RUSSIAN REGULATOR NAMES 12 FRAUDULENT ONLINE TRADING COMPANIES THAT MOST OFTEN TARGET INVESTORS
On 9th October, Finance Feeds reported that the Russia’s Federal Financial Monitoring Service has warned that a raft of foreign entities are offering investment services in Russia without having the right to do so.
GAMBLER FROM SUNDERLAND ADMITS TO STEALING £890,000 FROM SPORTS GIANT NIKE
The Sunderland Echo on 9th October reported that Christopher Edward Rawding, 34, pleaded guilty 2 charges of fraud by false representation during a 3½ year period, while he was working for the global sports company 2015-18. He was a cash collector and his job was to obtain funds from customers who were placing large orders.
GREECE’S CRUISING TAX FOR YACHTS: WHAT WAS THE IMPACT?
On 8th October, an article on Superyacht News examined the impact of the new cruising tax, TEPAI, introduced in May 2019 by the Greek government. It says that it was first proposed in 2014, and that its introduction was beset with issues from the outset, including a lack of any method of registering or paying the tax. The tax applies to vessels over 7 metres and is payable prior to or upon entry into Greek waters at a monthly rate of €8 per metre (for yachts over 12 metres). The article says that while the implementation of the cruising tax may have had little impact on the 2019 summer season, charter regulations introduced in 2018 continued to inconvenience charter yachts with cruising itineraries in Greece – such as requiring commercial yachts not in possession of a Greek charter licence to both embark and disembark charter guests outside of the country.
https://www.superyachtnews.com/business/greek-cruising-tax-what-was-the-impact
FOREIGN FORESTRY COMPANIES NEW ZEALAND’S BIGGEST LANDOWNERS
On 8th October, Customs Today reported that, despite a clampdown on some overseas investment, including a ban on residential sales to offshore buyers, the Labour-led government has actively encouraged further foreign purchases of land for forestry through a stream-lined ‘special forestry test’. Since the government was formed, the Overseas Investment Office (OIO) has approved more than $2.3 billion of forestry-related land sales – about 31,000 hectares of it previously in New Zealand hands. Of that, about half has been sold via a streamlined ‘special forestry test’ introduced by the government in October 2018.
http://www.customstoday.com.pk/green-rush-foreign-forestry-companies-nzs-biggest-landowners/
INDONESIA: TEXTILE INDUSTRY UNDER SCRUTINY FOR POTENTIAL ‘IMPORT LEAKS’
Customs Today on 8th October reported that the Trade Ministry is working with a special task force to audit producers’ importer identification numbers (API-P) to verify the textile industry’s import quantity and identify possible “import leaks”. The Ministry’s move follows urgings from the textile industry for the government to protect them from rapidly growing imports, as the sector cannot compete in the domestic and international markets.
http://www.customstoday.com.pk/textile-industry-under-scrutiny-for-potential-import-leaks/
UNODC-WCO CONTAINER CONTROL PROGRAMME CELEBRATES 15 YEARS OF MAKING GLOBAL TRADE SAFER FROM CRIME
On 8th October, the UN Office on Drugs and Crime published a news release celebrating the 15th anniversary of the Container Control Programme (CCP), which counters the cross-border movement of illicit goods and is jointly implemented by UNODC and WCO. The CCP assists governments in building the capacities of national agencies at the border to detect illicit goods in sea, land and air cargo consignments and thereby helps to strengthen international supply chain security and contributes to facilitate legitimate trade. It began as a modest project, established in 4 seaports and primarily focused on drug trafficking, and has become a far-reaching programme on a global scale – now it is established more than 100 operational inter-agency Units in over 50 countries and has expanded its focus to include airports, dry ports, land border crossings and rail terminals.
KILLINGS REVEAL LONGTIME COCAINE PRODUCTION IN GUATEMALA
On 8th October, Insight Crime reported that the killing of 3 naval officers in an eastern coastal region dominated by organised crime, and the implementation of martial law, has drawn attention to the country becoming a cocaine producer. The Interior Minister has said that Guatemala had gone from being a drug transit country to a cocaine-producing country, authorities then locating and destroying 4 cocaine-producing laboratories with the production capacity of between 300 and 500 kg daily.
https://www.insightcrime.org/news/analysis/killings-cocaine-production-guatemala/
ANTI-DOPING PROBE EXPOSES BAD BLOOD IN RUSSIAN SPORTS
A feature on Rferl on 8th October was concerned with ongoing problems with cleaning up Russian athletics, and officials tasked with cleaning up Russian athletics slinging mud and preparing for the worst – including a potential ban from the 2020 Tokyo Olympics and future Games. This centres on a controversy which erupted following international sport’s World Anti-Doping Agency (WADA) announcement in September that it was giving Russia 3 weeks to explain “inconsistencies” in data received from the Moscow Anti-Doping Laboratory.
https://www.rferl.org/a/wada-investigation-russian-sports-bad-blood/30206345.html
THE EFFECTIVENESS OF EXPORT PROMOTION MEASURES
An article from the VOX website, the CEPR Policy Portal on 9th October says that public export promotion agencies, which provide direct support to exporting firms, are used in many countries around the world. It surveys the literature that examines the effects of export promotion policies using firm-level observational data. While empirical studies generally find a positive effect of such measures, many show differences in the pattern of effects depending on firm characteristics. The survey also suggests that bundled services combining multiple types of support – and the more direct measures, such as helping firms find distributors – are more effective.
https://voxeu.org/article/effectiveness-export-promotion-measures
CYPRUS: REVENUE FROM SHIP MANAGEMENT OVER €1 BILLION
On 9th October, Hellenic Shipping News reported that revenue from ship management companies in 2018 reached €1.034 billion, with the President of the country noting at the same time that the discovery of significant quantities of hydrocarbons in Eastern Mediterranean region generates new opportunities for Cyprus’ shipping industry.
DoJ GUIDANCE ON WHEN A DEFENDANT IS UNABLE TO PAY PENALTY
On 8th October, the Wall Street Journal reported that the US DoJ had issued guidance for federal prosecutors to use in cases where companies claim they can’t pay a criminal fine and provide more transparency in cases where financially troubled companies are faced with criminal penalties.
NO MORE SECRET PURCHASES OF CONDOS IN MANHATTAN
On 8th October, the Wall Street Journal reported that a state law in New York makes every condo buyer’s name publicly available under the state’s Freedom of Information Law. This followed a dispute over home conversions in suburban Rockland County, because of which lawmakers in the county drew up state legislation to prevent the anonymous purchase of homes through the creation of LLC – because some residents suspected their new neighbours of making illegal home conversions or subdivisions, and getting local authorities to enforce the rules is more difficult if a property is owned through an LLC. In one tower, more than 85% of all purchases were made through LLC. It is reported that 12% of all condos and 5% of houses in New York City are owned via LLC, and federal officials say some buyers use LLC to launder money or conceal ill-gotten wealth.
PODCAST: RANSOMWARE
In the latest TRACE podcast, Renee Dudley of ProPublica discusses her fascinating research into the unsettling world of ransomware: how it works, the role that “recovery services” play, and where the ransom money ends up.
https://traceinternational.org/bribe_swindle_or_steal
MEMBER STATES PUBLISH A REPORT ON EU CO-ORDINATED RISK ASSESSMENT OF 5G NETWORKS SECURITY
On 9th October, a news release from the EU says that the report is based on the results of the national cybersecurity risk assessments by all EU Member States. It identifies the main threats and threats actors, the most sensitive assets, the main vulnerabilities (including technical ones and other types of vulnerabilities) and a number of strategic risks. This assessment provides the basis to identify mitigation measures that can be applied at national and European level.
https://europa.eu/rapid/press-release_IP-19-6049_en.htm
LIBYA’S WAR BECOMES A TECH BATTLEGROUND
On 9th October, Defence Web reported that fleets of long-range drones carry out strikes, cyber-attacks proclaim the end of governments, and social media propaganda has become all-consuming. It says that foreign actors have largely been driving this war. Turkey and Qatar support the GNA, while the UAE, Egypt, Russia and France are behind the LAAF. These foreign backers have contributed diplomatic support, military equipment, mercenaries and military personnel, and direct military action to the 2 sides. In 6 months, drones have become a mainstay of Libya’s conflict. A UN spokesman said that the current conflict has seen some 900 missions flown by drones fielded by the 2 sides, and this has increased steeply in recent weeks. Both sides use them for surveillance, long-range strategic strikes on arms depots and airports, and close-air support to units enmeshed in urban combat; and some 900 missions flown by drones. Alongside drones, hacking and cyber-attacks have been weaponised in Libya’s conflict and like drones, cyber-attacks offer a low-cost means of achieving conflict goals.
NIGERIA MARITIME OFFICIALS DISCUSS ANTI-GRAFT METHODS
On 9th October, OCCRP reported a meeting of Nigerian anti-corruption officials on how to effectively combat graft in the country’s ports, which annually lose up to $6.89 billion to “negative operational elements”. It is said that the ports lack the necessary infrastructure to properly monitor all transactions.
https://www.occrp.org/en/daily/10856-nigeria-maritime-officials-discuss-anti-graft-methods
24 TAIWANESE ARRESTED IN BUST OF INTERNATIONAL TELECOM FRAUD RING
Focus Taiwan on 9th October reported that 24 Taiwanese were arrested last month in Vietnam on suspicion of telecoms fraud, allegedly were targeting Chinese-Americans in the US and posing as officers from the FBI and the Chinese Ministry of Public Security.
http://focustaiwan.tw/news/asoc/201910090019.aspx
IRISH BOOKMAKERS GRANTED BETTING TAX RELIEF IN 2020 BUDGET
On 9th October, i-Gaming Business reported that it has been confirmed that in its 2020 Budget bookmakers in Ireland will receive a relief of up to €50,000 from the 2% turnover tax levied on betting in the country.
https://www.igamingbusiness.com/news/irish-bookies-granted-tax-relief-2020-budget
ADDRESSING THE ABUSE OF TRADE FOR MONEY LAUNDERING PURPOSES
A Commentary from RUSI on 9th October says that while the problem of detecting and tackling money laundering has taxed financial institutions and law enforcement for decades, trade-based money laundering adds a new dimension of complexity; but tackling it will require new collaboration and information sharing across the global trade, financial services and law enforcement communities. There are, it says, significant hurdles in the form of legal and commercial constraints, privacy concerns and alignment of incentives which became evident when the authors recently conducted over 60 interviews with these communities in the UK, Europe, North America, Middle East and Singapore.
https://rusi.org/commentary/addressing-abuse-trade-money-laundering-purposes
BUENOS AIRES’ MAIN INTERNATIONAL AIRPORT REMAINS A HOTSPOT FOR COCAINE SMUGGLING TO EUROPE
An article on Insight Crime on 9th October reported that the dismantling of a major criminal organisation in Italy provides further evidence of the importance of the airport in Buenos Aires in cocaine smuggling. 2 dozen people were arrested in an operation in Palermo, the final destination for the cocaine flown from Argentina but discovered in Paris. Once in Paris, the smugglers transported the drugs by train and by car to Palermo. It is said that, with easy connections to Europe and corruptible customs officials, Argentina’s Ezeiza International Airport has long been known as a drug transshipment point.
https://www.insightcrime.org/news/brief/europe-buenos-aires-argentina-drug-smugglers/
SPAIN TESTS NO-DEAL BREXIT PASSPORT CONTROLS, CAUSING BORDER LOGJAM
On 9th October, the Gibraltar Chronicle reported that cross-border commuters heading from Spain into Gibraltar faced delays as Spanish authorities intensified passport checks in a trial run of measures that could come into force in the event of a hard Brexit.
https://www.chronicle.gi/spain-tests-no-deal-brexit-passport-controls-causing-border-logjam/
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