10th January 2020
IRAN’S MILLIONAIRE MULLAHS, THE MILITARY, AND THE FIGHT FOR FOREIGN CURRENCY
On 6 January, Deutsche Welle carried an article about the Revolutionary Guard is a powerful economic force in Iran and, with the country’s economy flailing as a potential war with the US looms, its influence is likely to grow.
FIGHT AGAINST CORRUPTION: FRANCE MUST DO BETTER
On 9 January, the Council of Europe published a report from its anti-corruption body in which it calls on France to improve the effectiveness and practical application of measures to prevent corruption within the executive (President of the Republic, ministers, private office members and senior civil servants) as well as in the National Police and the National Gendarmerie, while noting some positive legislative developments to strengthen transparency in public life and integrity within the executive.
UK: DISCLOSURE OF EVIDENCE IN CRIMINAL PROCEEDINGS
On 10 January, the House of Lords Library published a briefing paper which provides a chronology of recent discussions on the disclosure of evidence in criminal proceedings. It includes an overview of disclosure procedures, notable high-profile cases, and recent developments in disclosure practices across the criminal justice system. It says that disclosure has been the subject of scrutiny for over a decade. The House of Commons Justice Committee launched an inquiry into the disclosure of evidence in criminal cases in January 2018, and the final report was published in July 2018. It provided recommendations for several partners across the criminal justice system.
HOW MUCH RADIOACTIVE WASTE IS THERE IN THE UK?
On 10 January, a post on the GOV.UK blog site advised that the UK Radioactive Waste Inventory provides detailed information on radioactive wastes and material in the country. It is essentially a huge dataset with information about all the radioactive waste and materials that we have in the UK, and that it is estimated will arise in future. The amount of radioactive waste produced in the UK is very small compared to all other forms of waste.
MAN JAILED FOR DUPING ROYAL NAVY INTO BUYING KIT UNFIT FOR USE IN £1.4 MILLION FRAUD
On 10 January, LBC reported that Carl Tiltman, 56, will spend more than 3 years behind bars after admitting fraud by false representation and fraud by abuse of position. He duped the Royal Navy into investing in underwater scanning technology after using fake test results to lie about its capabilities in his sales pitch.
UK: HALF OF NHS TRUSTS OUTSOURCE OUTPATIENT PHARMACY SERVICES TO AVOID VAT
On 7 January, the Pharmaceutical Journal reported that data show 53 NHS trusts have a subsidiary outpatient pharmacy and that half of NHS trusts now outsource their outpatient pharmacies in an effort to save tax, according to NHS figures, despite union leaders saying this practice is detrimental to staff pay.
US JUDGE DISMISSES 2 HELMS-BURTON CASES INVOLVING CUBAN PROPERTY CLAIMS BY US BUSINESSES
The EU Sanctions Blog on 10 January reported that a US federal Judge in Florida has dismissed 2 Helms-Burton cases filed against Norwegian Cruise Line and MSC cruises, because the conduct had taken place after the plaintiff’s interest in the property had expired. However, the judge said that if the cruise lines’ alleged activities had taken place between 1960 and 2004, they would have been found to have “trafficked” in the plaintiff’s confiscated property under Title III of the Helms-Burton Act. The blog also mentioned that, in August, Carnival Corporation’s motion to dismiss similar Helms-Burton proceedings was denied. Title III allows for claims for use/misuse of formerly-held property seized and made use of for or by the Cuban regime.
US DEPORTS SALVADORAN NATIONAL WANTED FOR BRIBERY ETC AFTER 12 YEAR LEGAL BATTLE
On 9 January, a news release from US Immigration and Customs Enforcement announced that it had repatriated Roberto Carlos Silva-Pereira, 45, a citizen of El Salvador who is wanted for bribery and money laundering in his native country in addition to murder in Guatemala. An arrest warrant against Silva-Pereira for bribery and money laundering was issued in Guatemala in 2007, and he was arrested in 2008 in the US but then years of litigation followed – until he was finally removed on 8 January.
EU SAID TO BE PREPARING FURTHER TARGETED SANCTIONS AGAINST VENEZUELA
On 9 January, a news release from the EU announced that the EU was “ready to start work towards applying targeted measures against individuals” involved in recent acts undermining democracy, rule of law and human rights in Venezuela. 25 Venezuelan officials are already currently designated under EU sanctions.
US FORMALLY INDICTS RESEARCHER FOR BLOCKCHAIN LECTURE IN NORTH KOREA
On 9 January, NK News reported that a grand jury had formally indicted US blockchain researcher Virgil Griffiths, and reported that one of his associates was also expected to be arrested.
HUMAN TRAFFICKING: CLOSER TO HOME THAN YOU THINK,SAYS UK BANKERS GROUP
On 6 January, the American Bankers’ Association Banking Journal published an article saying that the UN International Labor Organization has estimated that there are currently 25 million victims of human trafficking around the world. It goes on to say that, within the US, human trafficking is widely unreported for a variety of reasons, including fear or immigration status, but the ILO estimated that approximately 403,000 persons are trafficked in the US at any one time. It points out that January is Human Trafficking Awareness Month, and says that the good news is that the financial industry and especially anti-money laundering professionals, can help stop these criminals with enhanced awareness and training, knowledge of typologies and red flags, and strong relationships with law enforcement. It then provides some guidance and information on sex and labour trafficking in the US, red flags etc.
ARMED DRONES IN THE MIDDLE EAST: PROLIFERATION AND NORMS IN THE REGION
On 17 December, RUSI published an Occasional Paper which aims to provide an in-depth inventory of armed drones possessed by Middle Eastern states, assessing quantity, types and timeframes; and to explore where and how armed drones have been used so far, to assess whether and how countries’ practices and ethical considerations around airpower and airstrikes are affected. It is said that the main conclusions drawn by this paper are that over the past few years more and more countries across the Middle East have acquired armed drones, either by importing them (Jordan, Iraq, Saudi Arabia and the UAE) or by building them domestically (Israel, Iran and Turkey). China, a no-questions-asked exporter of drones, has played and is likely to continue playing a key role as a supplier of armed UAV to the Middle East.
FATF SUPERVISORS’ FORUM ON SUPERVISING VIRTUAL ASSETS
On 10 January, FATF issued a news release on this meeting in Paris on 9 January. It is said that supervisors from around the world met to discuss how to supervise and regulate virtual assets and virtual asset service providers (VASP). This meeting was the first opportunity for supervisors to discuss how to implement these new measures since the FATF finalised them in June 2019. Participants in this Forum shared their knowledge and experience in virtual assets and VASP supervision and discussed 3 main areas – lessons learnt so far from countries that have already established VASP supervisory regimes and are already supervising VASP; common issues when drafting VASP laws and regulations; and the tools, skills, procedures and technology that supervisors need to effectively supervise VASP.
PAKISTAN: AUTHORITIES TRACE 10,000 PEOPLE INVOLVED IN MONEY LAUNDERING
The International News on 10 January reported that the Federal Board of Revenue (FBR) says it has traced out less than 10,000 people who are involved in cash transactions running into trillions of rupees allegedly for the purpose of tax evasion and with possibility of involvement in money laundering. It is also said to be looking into affairs of non-profit organisations (NPO) and international non-profit organisations (INPO) with regard to alleged involvement in money laundering and terror financing.
CANADIAN PROSECUTORS SAY CASE AGAINST HUAWEI CFO IS ABOUT FRAUD, NOT SANCTIONS
On 10 January, Reuters reported that Huawei executive Meng Wanzhou’s conduct amounts to fraud under Canadian law and the court need not consider US sanctions law, Canadian federal prosecutors have argued. Meng, 47, was arrested at the Vancouver International Airport in December 2018, at the request of the US, where she is charged with bank fraud.
IS ANGOLA’S ANTI-CORRUPTION DRIVE REAL OR COSMETIC?
On 10 January, Voice of America carried this article, saying that increasingly, President Lourenco’s anti-corruption efforts appear to target former president Dos Santos’ family members, and that, along with the government’s reluctance to prosecute the former vice-president, a top Lourenco ally, is leading critics to ask whether Lourenco is actually trying to destroy corruption. In 2018, Angola’s government strenuously protected former Vice-President Manuel Vicente against corruption charges in a Portuguese court
CANADA: FORMER SNC-LAVALIN EXECUTIVE GETS 8½ YEARS FOR FRAUD AND CORRUPTION
On 10 January, The Star reported that former SNC-Lavalin executive Sami Bebawi, 73, was sentenced to 8½ years in prison, in the last of the criminal cases brought against the engineering giant and its former employees involved in fraud and corruption in Libya.
SEYCHELLES AIMS TO GET TOUGH ON MONEY LAUNDERING AND TERRORISM FINANCING
In its 11 January edition, CGTN in China carried an article saying that a new, stronger Bill on AML/CFT will be tabled before the National Assembly for approval in February, as part of a phased approach to strengthen the domestic framework.
UK: RETROSPECTIVE TAXATION
On 10 January, the House of Commons Library published a briefing paper saying that retrospective tax legislation imposes or increases a tax charge prior to the legislation being introduced. It says that although this is a controversial practice, retrospective provisions are often introduced to mitigate the risks to the Exchequer from tax avoidance. This paper discusses the origin of the “Rees Rules” (an approach to retrospective taxation codified in 1978), and subsequent debates as to the use of retrospective changes in tax law.
DUTCH BANKS ARE FREEZING ACCOUNTS UNDER FATCA
Investment Europe on 10 January reported that Dutch banks have started freezing the accounts of dozens of ‘accidental’ Americans in the Netherlands because they have failed to provide them with their US tax information numbers (TIN), a requirement under FATCA.
INCREASINGLY COMPANIES’ OPERATIONS AND DISCLOSURES ARE PUBLICLY EVALUATED BY “BENCHMARKS” THAT COMPARE PERFORMANCE ON HUMAN RIGHTS AND RECOGNISED ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) ISSUES
On 10 January, an article from law firm White & Case is concerned with human rights and ESG benchmarks public rankings or analyses — typically based on publicly available information and produced by civil society or NGO, foundations, investor groups and others – notably civil society organisations with funding from governments and investors. The article examines the implications of such benchmarking, explaining what might be measured. It provides a business case for understanding human rights and environmental benchmarks, and how a business can improve its scoring.
KYRGYZSTAN TO STRENGTHEN EFFORTS TO CURB SHADOW ECONOMY
On 10 January, Xinhua reported that the Kyrgyz government will step up efforts to curb the shadow economy in 2020, the Kyrgyz Prime Minister has said, and that automatic monitoring systems have already been deployed at the border checkpoints with Kazakhstan to check for smuggled goods. It is said that data from different sources show that the shadow economy accounts for 24% to 37% of the GDP.
RECORD NUMBER OF DRUGS SEIZURES IN BELGIUM IN 2019
The Brussels Times on 8 January reported a growth of 660% in 5 years in the case of cocaine. Cocaine is the most seized drug in Belgium. In the port of Antwerp, 119 discoveries were recorded last year, a figure representing 61.8 tonnes. The main sources for hard drugs remain the same: Brazil, Ecuador and Colombia.
ISRAEL SUPREME COURT ORDERS CUSTOMS AUTHORITY TO END PREFERENTIAL TREATMENT OF ISRAEL POST
On 8 January, Israel National News reported that the Court has ordered the Customs Authority to inspect packages sent via Israel Post, the same way they are inspected when sent through other postal companies – a change will take effect on 15 February and will affect all packages over $75. A case brought by trade bodies and the chamber of commerce had said that the situation had exempted Israel Post from all the demands placed on importers, including from import tax and demands concerning the objects’ safety.
LOS POCHOS, GUATEMALA’S NEW GENERATION OF DRUG RUNNERS FOR SINALOA CARTEL
On 10 January, Insight Crime reported that the arrest of a mayor in Guatemala’s northern department of San Marcos has unveiled a new criminal structure. It is said that Erick Salvador Súñiga Rodríguez (aka “El Pocho”) and the mayor of the municipality of Ayutla in the department of San Marcos, surrendered to the DEA in mid-December and agreed to reveal details of his role in trafficking cocaine from Guatemala to the US.
UK: THE FCA CRYPTOCURRENCY AML REGULATION REGIME
On 10 January, Eversheds Sutherland published a briefing saying that the FCA began supervising AML/CFT compliance within the cryptoasset sector from 10 January. The article looks at regime scope and regulatory deadlines, and the risk-based approach. The article reminds one that the FCA Gateway opens for businesses to submit registration applications on 10 January with a hard deadline of 10 January 2021.