21 December 2019
Export Control (Sanctions) (Amendment) Order 2019
A news release from the Isle of Man on 20 December announced the application order applying this UK order in the Island, and making various changes to existing sanctions regimes under Isle of Man law. Among the changes, Eritrea is added to the list of destinations subject to transit controls for Category B goods (i.e. certain military goods subject to trade controls), anew offence for the breach of the prohibition in the EU South Sudan Regulation relating to the provision of services of armed mercenary personnel in South Sudan is also created; a new offence of failing to comply with a condition included in an authorisation granted under the Venezuelan Sanctions Regulation and to create a penalty for that offence; and new offences for, or in connection with, contravention of trade restrictions which have been added to the North Korea Regulation.
Recent enforcement actions by the US Bureau of Industry and Security Office of Antiboycott Compliance are a warning
On 20 December, The National Law Review published an article saying that recent action by the OAC serve as a warning to U.S. persons (including U.S. companies) with business interests in and around the Middle East. It is easy for the complacent to run afoul of OAC’s Antiboycott Regulations when evaluating and responding to otherwise routine documents such as a letters of credit, shipping certificates, or purchase orders. The Regulations prohibit U.S. persons, including “controlled in fact” foreign subsidiaries of U.S. companies, from complying with foreign boycott requests in regards to a business opportunity within “interstate or foreign commerce of the United States”. The most obvious boycott is that of Israel, but a case highlighted in the article involved compliance with the boycott by several Arab states of Qatar.
How Italy Sold Armoured Vehicles To Russia Which Were Deployed With Syrian Army Militias
On 20 December, investigative site Bellingcat published an article claiming that Italy has supplied Iveco Light Multirole Vehicles (LMV) to the Russian Defense Ministry. They have been located on multiple occasions within the context of the war in Syria – not not only operated by Russian military personnel but in some cases also embedded with and/or diverted to local Syrian militia leaders who are under EU sanctions for their responsibility in human rights abuses. The article goes on to explain: what is the Italian Iveco LMV; how did they get to Syria from Russia[ where and when the Iveco LMV were being used in Syria; who are the EU-sanctioned Syrian militia leaders using the Iveco LMV; and why transactions for the sale of these “arms” appear to be anomalous.
South African Reserve Bank (Sarb) has imposed administrative sanctions on 5 banks for AML weaknesses
On 21 December, iAfrica reported that the central bank said that it found weaknesses in each of the bank’s money laundering control measures – at Standard Bank, Grobank, Ubank Limited, Bank of China and HBZ Bank Limited.
New Zealand: Customs’ crackdown on undeclared cash nets almost $1 million
Newshub on 21 December reported that, in the first nine months of the year, undeclared cash was detected 550 times with customs seizing almost $974,000. It is not illegal to enter the country with more than $10,000, but it must be declared.
Swiss indict Ukrainian politician over suspected money laundering
On 20 December, MENA-FN reported that the Office of the Attorney General of Switzerland (OAG) has filed an indictment against Ukrainian former lawmaker Mykola Martynenko and a second, unnamed, Ukrainian national over the suspected money-laundering of around €2.8 million. These alleged offences are said to be currently the subject of criminal investigations by the Ukrainian and Czech authorities, and connected to commission paid by SKODA JS, a Czech supplier of components for nuclear power stations.
Russia quietly expands military ties with Laos
On 14 December, the Nikkei Asian Review carried an article saying that Russia is quietly strengthening military ties with Laos in a bid to re-establish itself as a major player in SE Asia, with a first-ever joint military exercise. It is said that Russia hoped to use the drill with Laos to encourage other SE Asian countries to deepen their military ties with Moscow (and buy its arms).
Russia up in arms over Chinese theft of military technology
On 20 December, the Nikkei Asian Review reported that, in a rare public display of frustration between the 2 countries, Russian state defence conglomerate Rostec has accused China of illegally copying a broad range of Russian weaponry and other military hardware.
Trump signs Nord Stream 2 sanctions law into force
On 21 December, various media reported that President Trump had signed off on US sanctions against companies building a Russian gas pipeline to Germany.
The Vatican-Centurion Global financial scandal
On 21 December, the Catholoc News Agency ran what it described as an “Explainer” about a Vatican financial scandal involving a multi-million-dollar investment fund, money donated by Catholics to support charity and Vatican ministries, and a pair of banks linked to money laundering and bribery allegations. This is said to be one of several unfolding at the Vatican, and covered by CNA. It involves Centurion Global, an investment fund by which the Vatican Secretariat of State has invested tens of millions of dollars into Hollywood films, energy projects, and European start-ups. Also involved are a small Swiss private bank named in the PDVSA affairs, and banks in Malta.
Malta: Italian wanted for extradition over money laundering back in court
The Malta Independent on 21 December reported that Antonio Ricci, an Italian national who avoided being extradited to Italy on charges of laundering ‘Ndrangheta mafia funds in June, is back in court after a European arrest warrant was issued by Italian authorities. He is wanted by a court in Italy to answer charges that he laundered money through his iGaming company. He is also oneof several men, alongside Yorgen Fenech, charged with complicity to murder journalist Daphne Caruana Galizia, to be charged by a Catania court with illegal betting.
Police in Spain arrest Swedish fugitive for murder and money laundering
On 21 December, Euro Weekly reported that a Swedish man wanted for murder as well as being linked to a scam in 2017, when a company transferred, induced by a hoax, €629,000 to the bank account of another Swedish company. He is said to have received €48,000 from the money.
Rwandan official guilty of genocide
On 20 December, the EU Observer reported that a Belgian court had found Fabien Neretse, 71, an agricultural scientist, guilty of genocide and war crimes. He set up a militia to kill Tutsi Rwandans during the genocide of 1994 and was found guilty of the killing of 11 people, as the first Rwandan to be convicted in Belgium (the former colonial power) for the Rwandan genocide where up to 1 million people were killed.
Libyan government accepts Turkish military help
On 17 December, EU Observer reported that the internationally-recognised government of Libya has accepted an offer from Turkey to send military and logistic support in order to protect itself from an attack against Tripoli, and Turkey is said to be considering sending troops.
Non-EU countries have aligned with extension of EU Venezuela sanctions
A news release on 20 December advised that North Macedonia, Albania, Iceland, Liechtenstein, Ukraine, Moldova, Armenia and Georgia have aligned themselves with the decision to extend EU sanctions until 14 November 2020.
FATF BUSINESS BULLETIN
On 20 December, FATF published the latest edition of its regular bulletin of news and developments, with summaries of recent mutual evaluations and follow-up reports.
Briefing paper: trade in services and Brexit
On 20 December, the House of Commons Library published a briefing paper which says that the future of services trade has received less attention in the public debate than trade in goods. The UK’s exposure to services trade means however that businesses in many sectors across the economy will be affected. This paper looks at the complexity of international trade in services and discusses what could change under different future scenarios.
UK: TURKEY (ASSET-FREEZING) REGULATIONS 2019
These new Regulations in the UK provide for domestic enforcement regime for a new EU sanctions regime in light of Turkey’s unauthorised hydrocarbon drilling activities in the Eastern Mediterranean. To date, no-one has been designated under the regime.
UK: briefing paper on “Loot Boxes”
On 19 December, the House of Commons Library produced an updated briefing paper which a brief overview of concerns about loot boxes in video games.
UK: Proscribed Terrorist Organisations
On 18 December, the House of Commons Library produced a briefing paper which sets out the grounds for proscription, the related offences under the Terrorism Act 2000, and some of the issues relating to the deproscription process. An Annex to this paper includes a current list of proscribed organisations and a description of their activities.
UK: MONEY LAUNDERING AND TERRORIST FINANCING (AMENDMENT) REGULATIONS 2019
These Regulations update the UK’s existing AML legislation to implement changes in the EU’s framework, the 4th Money Laundering Directive. They also amend the Terrorism Act 2000 and the Proceeds of Crime Act 2002 in order to align the definitions of the “regulated sector” in those Acts with the Directive.
China´s Maritime Silk Road Initiative
On 19 December, ETH Zurich produced an updated graphic saying that China’s Belt and Road Initiative (BRI) has both a land-based and maritime component. This graphic provides an overview of the maritime element, the Maritime Silk Road Initiative (MSRI) which connects connects China to Europe and Africa via the Middle East. A brief is also available, including implications for China’s impact on the Middle East.
UK: first fine under GDPR
On 20 December, the Law Society Gazette reported that the Information Commissioner’s Office (ICO) has fined a London pharmacy £275,000 for failing to ensure the security of special category data. The documents involved included names, addresses, dates of birth, NHS numbers, medical information and prescriptions belonging to an unknown number of people.
UK-US extradition process factsheet
On 20 December, a post on the Gov.uk blog set out the process governed by the US/UK Extradition Treaty.
Questions remain over new yacht charter VAT regime in the EU
On 20 December, an article in Superyacht News said that, with the January deadline imminent, there is no clear picture of how the EU’s new VAT Directives will work in practice. It is said that the application of current VAT reductions on charters in Italy, France, Malta, Cyprus and Greece should no longer be applicable in 2020. In 2020, the only possible reductions in VAT will be granted on a pro rata basis. However, it says, quite how these reductions will be implemented remains a mystery.
Sweden’s gambling regulator is seeking the ability to impose stiffer fines on companies that violate AML regulations
On 20 December, Calvin Ayre reported that the Spelinspektionen has asked the Ministry of Finance to rewrite rules regarding the maximum penalty. It said the current maximum penalty of €1 million is too low and it needs to be able to impose penalties that are “effective, proportionate and dissuasive”.
Jersey: First major confiscation under Forfeiture of Assets Law of 2018
A news release on 19 December advised that the most significant successful application under the 2018 Forfeiture of Assets Law has just been concluded, with more than $ 10 million paid into Jersey’s Criminal Offences Confiscation Fund. The law is described as a “radical” new statute allows the forfeiture of tainted assets held in bank accounts. If the assets have been subject to a police ‘no consent’ for over 12 months then a fast track procedure, resulting in forfeiture by a court order, can be pursued.
Ukrainian sailors tricked into the yacht migrant trade in Europe
A report from OCCRP on 17 December says that at the centre of the yacht-based smuggling trade is at least one thriving transnational criminal network based in both Turkey and Ukraine, and law enforcement agencies from across Europe have had little success disrupting the network or arresting its high-level operatives. Recent arrests by Greek and Italian authorities, supported by Europol, show some progress, but the kingpins of the yacht-smuggling network remain at large. It is also said that, despite what Ukrainian authorities say is the widespread use of deception to recruit boat crews, investigators have made little effort to go after high-level operators, according to imprisoned sailors, their families, and lawyers.
Mexican Corruption Prosecutor Opens 680 Investigations
On 20 December, OCCRP reported that 8 months after she was appointed as Mexico’s first-ever Chief Anticorruption Prosecutor, Luz Mijangos Borja has opened 680 investigations. She has built her office from zero in what is perceived to be a very corrupt country.
ORGANISED CRIME GROUP IN SPAIN POISONED 27 PEOPLE WITH ILLEGALLY POACHED CLAMS
On 20 December, OCCRP reported that 43 people were arrested and 11 companies were placed under investigation following the food poisoning. Police seized more than 40 tons of Japanese clams along with cash. They also raided several hideouts where criminals were keeping the clams in hatcheries. Those responsible for running the illegal hatcheries mixed contaminated clams with ones acquired legally and used false documents from Portuguese estuaries to make it difficult to trace their origin.
Switzerland returns pre-Colombian treasures to Peru
On 19 December, Swissinfo reported that Switzerland has returned 48 pre-Colombian artefacts of inestimable value to Peru that had been discovered at the Geneva free port facility.
Cigarette smuggling operation brought 28 million into New Zealand
Stuff on 18 December reported that a so-far unnamed businessman has admitted smuggling an estimated 28 million cigarettes into Auckland and avoiding excise duties of over $25 million. The man and his company pleaded guilty on Monday to defrauding customs, making erroneous entries in customs documents and selling goods without paying duties.
Tankers Go Dark to Help Venezuela Evade Oil Sanctions
On 17 December, Insight Crime reported that tankers turn their transponders off before entering Venezuelan waters, allowing them to load crude from the sanctioned state oil company Petroleos de Venezuela SA (PdVSA), without being detected by GPS.
Authorities raid Maersk offices in Brazil as part of bribery probe
On 20 December, American Shipper reported that the shipping company is one of several firms targeted in investigations into alleged payments to secure contracts with Petrobras.