OTHER THINGS YOU MAY HAVE MISSED – JANUARY 23

23 January 2020

HOW 237 MALTESE TAXPAYERS GOT OFF THE PANAMA PAPERS HOOK

On 22 January, the Times of Malta reported that a total of 237 Maltese taxpayers had featured in the Panama Papers leak, yet the police never carried out a comprehensive probe into all those individuals and companies named, with the bulk of the investigations were carried out by the Inland Revenue Department in an administrative process rather than a criminal probe and in 2019 €9.1 million recovered by the taxman after offshore dealings were exposed in the Panama Papers in 2016.

https://timesofmalta.com/articles/view/how-237-maltese-taxpayers-got-off-the-panama-papers-hook.765168

https://www.maltatoday.com.mt/news/national/99921/panama_papers_and_swiss_leaks_tax_investigations_yield_106_million_in_fines#.XinT125FzIU

BELGIUM’S MAIN BANKS WILL START SHARING PERSONAL DATA USING BLOCKCHAIN

On 22 January, the Brussels Times reported that Belgium’s 4 major banks, Belfius, BNP Paribas Fortis, ING Belgium and KBC, will use a blockchain to simplify their customer services – to share businesses’ data between them and thus facilitate the verification and maintenance of the businesses’ identities.  This is said to be a first in Europe, according to the main parties concerned.

https://www.brusselstimes.com/all-news/belgium-all-news/91086/belgiums-main-banks-to-share-identification-data-via-blockchain-belfius-bnp-paribas-fortis-ing-belgium-kbc-kube-app/

8 KIDNAPPED CREW FROM GREEK-FLAGGED TANKER FREED BY PIRATES

On23 January, Seatrade Maritime News reported that it has been announced that 8 crew members of the Greek-flagged tanker Happy Lady abducted by pirates in an attack near the coast of Cameroon were released on 22 January after 3 weeks in captivity.

https://www.seatrade-maritime.com/ship-operations/eight-kidnapped-crew-happy-lady-freed-pirates

BREXIT: INTRODUCTION TO THE UK WITHDRAWAL AGREEMENT

Gowling WLG has produced a briefing explaining the UK/EU withdrawal agreement.

https://gowlingprodblobstorage.blob.core.windows.net/gowlingprodblobstoragecontainer/gwlg/media/gowlingwlg/gwlg/insights-resources/guides/2020/01/200122-introduction-to-the-withdrawal-agreement.pdf

http://www.legislation.gov.uk/ukpga/2020/1/contents/enacted

US REMOVES KAZAKHSTAN NATIONAL CONVICTED OF WEAPONS TRAFFICKING TO RUSSIA

A news release from US Immigration and Customs Enforcement on 23 January reported that the US authorities had removed Eldar Rezvanov to his home country of Kazakhstan via commercial aircraft.  He had been convicted for international arms trafficking by exporting defence articles without obtaining a licence or authorisation.  He and his accomplices smuggled the firearms and firearm parts onto overseas flights using false shipping inventories and concealed the disassembled firearm components by taping them to metal kitchen utensils before shipping them overseas.

https://www.ice.gov/news/releases/ice-removes-kazakhstan-national-convicted-weapons-trafficking-russia

TAIWANESE CARRIER WAN HAI JOINS MANY CARRIERS IN ANNOUNCING IT WILL FINE SHIPPERS THAT INTENTIONALLY MISDECLARE CARGO CONTENTS

On 23 January, Loadstar reported that the carrier has told customers that it would fine shippers, and/or notified parties and consignees, $30,000 per container for misdeclared hazardous cargo, and $20,000 per box for non-hazardous contents – regardless of whether any damage resulted.  Under the terms of its bill of lading it also had the right to “immediately stop or suspend the delivery of the cargo or terminate the contract of delivery at any time during the carriage”.

https://theloadstar.com/wan-hai-joins-fellow-carriers-to-threaten-heavy-fines-for-misdeclared-cargo

LATIN AMERICA ANTI-CORRUPTION ENFORCEMENT REVIEW: Q4 2019

On 22 January, King & Spalding in the US published an article saying that, in the 4th quarter of 2019, US enforcement authorities sustained efforts to prosecute individuals violating US anti-corruption laws in matters related to Latin America, while authorities in Latin America, including in Brazil, Peru, and Mexico, pursued enforcement of their own, sometimes without coordinating with US authorities.   The article highlights these recent trends and developments.  The first case it mentions is actually a US one involving a scheme to bribe government officials in Indonesia, the case where the defendant challenged the conviction on the grounds that he never set foot in the US and was working in France while carrying a UK passport.

https://www.jdsupra.com/legalnews/q4-2019-latin-america-enforcement-review-83121/

AUSTRALIA: NAVIGATING THE COMPLIANCE DILEMMA OF DEFENCE EXPORT CONTROLS

On 23 January, Australia Defence Magazine published an article saying that the spectre of Defence Export Control Regulations for Australian Defence businesses is ever-present, and there are emerging changes and challenges that will require a renewed focus, with a current and impending compliance dilemma for many businesses that will, it says, become clearer as 2020 progresses.  It reminds one must take into account the US International Traffic in Arms Regulations (ITAR) and Export Administration Regulations (EAR), which Australian businesses must ensure they factor into any risk assessments linked to defence business associated with US technology.  It says that a number of elements have been introduced or reviewed during the last 12 months.   The article concludes that Australia should look to mirror the Canadian example and its Canadian Controlled Goods Program and it makes a number of recommendations, including requiring all businesses looking to export or handle US goods to be registered with the US and Australian Governments.

https://www.australiandefence.com.au/news/navigating-the-compliance-dilemma-of-defence-export-controls

ESTONIAN FINANCIAL WATCHDOG RECEIVES POSITIVE ASSESSMENT BY IMF

ERR on 23 January reported that experts of the IMF provided a positive assessment of the AML activities of Estonia’s Financial Supervision Authority (FSA).  It claims that money laundering risks in Estonia have decreased significantly in the last 5 years, and non-resident deposits have dropped to 10% at the end of 2019, down from 19% in 2014.

https://news.err.ee/1027022/estonian-financial-watchdog-receives-positive-assessment-by-imf

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https://www.armscontrol.org/blog/2020-01-23/us-russian-nuclear-arms-control-watch#factfile

THE LATEST INSIGHT INTO THE IRANIAN SITUATION AND HOW COMPANIES SHOULD PREPARE

RANE, the Risk Assistance Network & Exchange, has produced a webinar looking at the situation following the US air strike in Baghdad that killed Iranian Quds Force leader Qassem Soleimani.  A panel of experts consider what might be next in the Iran situation in both physical and cyber terms and what companies can do to mitigate the risk.

https://go.ranenetwork.com/webinar/replay/iran-situation

NEW EU RULES FOR IMPORTERS OF HIGH-RISK FOOD, FEED NOT OF ANIMAL ORIGIN AND LIVE ANIMALS

On 23 January, UK trade organisation BIFA published further information on the Smarter Rules for Safer Food (SRSF) affecting businesses which import live animals, products of animal origin (POAO), or high-risk food and feed not of animal origin (HRFNAO).  It urges those affected to register now.  Despite Brexit, the UK has provided some useful information on SRSF, with DEFRA describing it as a set of EU Regulations for the protection against animal disease and plant pests, and which will modernise, simplify and improve existing health and safety standards for the agri-food chain.  It will take a risk-based approach to animal, plant and public health protection, introducing more efficient pest and disease control measures.  The new Official Controls Regulation and Plant Health Regulation applied in EU Member States from 14 December and the new Animal Health Regulation will apply from 21 April.

https://www.bifa.org/news/articles/2020/jan/get-ready-for-traces-nt-important-information-regarding-pre-notification-of-imports?l=y

https://www.gov.uk/government/publications/smarter-rules-for-safer-food-what-we-are-doing/smarter-rules-for-safer-food

TAX HAVENS ATTRACT A RECORD NUMBER OF SLOVAK FIRMS

An article in Slovak Reporter says that an increasing number of Slovak companies are attracted by tax havens, leading to a new record in 2019.  It says that a total of 4,996 Slovak companies, worth an estimated €10.5 billion, currently have their base in tax havens.  The US and Netherlands are said to be the top two countries involved.

https://spectator.sme.sk/c/22309366/tax-havens-attract-a-record-high-number-of-slovak-firms.html

MIAMI-BASED BUSINESSMAN PLEADS GUILTY TO FCPA AND MONEY LAUNDERING VIOLATIONS IN SCHEME INVOLVING PETROECUADOR OFFICIALS

A news release from the DoJ on 23 January announced that, Armengol Alfonso Cevallos Diaz (Cevallos), 57, an Ecuadorian businessman living in Miami has pleaded guilty in connection with a $4.4 million bribery and money laundering scheme that funnelled bribes to public officials of Empresa Pública de Hidrocarburos del Ecuador (PetroEcuador), the state-owned and state-controlled oil company of Ecuador.  It is said that, from 2012 through 2015, he conspired with others to pay bribes of $4.4 million to PetroEcuador officials by using the mails and means and instrumentalities of interstate commerce, including US-based companies and US-based bank accounts, in order to obtain and retain business.  This latest plea follows 12 public charges and guilty pleas against other individuals in the DoJ ongoing investigation into bribery and money laundering involving PetroEcuador.

https://www.justice.gov/opa/pr/miami-based-businessman-pleads-guilty-fcpa-and-money-laundering-violations-scheme-involving

COLOMBIA SOCCER STAR EXTRADITED TO US ON DRUG TRAFFICKING CHARGES

On 23 January, ABC News reported that a former midfielder for Colombia’s national soccer team has been extradited to the US to face drug trafficking charges.  Jhon Viafara, 41, is accused of conspiring with members of the Gulf Cartel to organise cocaine shipments that left Colombia on speedboats.  The sides he played for included including Premier League sides Portsmouth and Southampton.

https://abcnews.go.com/International/wireStory/colombia-soccer-star-extradited-us-trafficking-charges-68486814

8 REASONS JAMAICA FELL IN THE LATEST CORRUPTION INDEX

On 23 January, the Gleaner in Jamaica carried an article in which the Head of the National Integrity Action, Professor Trevor Munroe  listed a number of developments in 2019 that might have contributed to a deterioration of Jamaica’s position in both score and rank.

http://jamaica-gleaner.com/article/news/20200123/eight-reasons-jamaicas-corruption-score-has-worsened

UK: TRANSPOSITION OF THE FIFTH MONEY LAUNDERING DIRECTIVE – RESPONSES PUBLISHED

On 23 January, HM Treasury published the responses it received to the consultation launched in April 2019.  The consultation closed on 10 June, with the government receiving over 200 responses from supervisors, industry, civil society, academia and government departments.

https://www.gov.uk/government/consultations/transposition-of-the-fifth-money-laundering-directive#history

UK: NCA CIVIL RECOVERY ORDER FOR AROUND £120,000 ALLEGEDLY LINKED TO THE SOUTH EAST ANTRIM UDA UNDER THE PROCEEDS OF CRIME ACT

On 23 January, a news release advised that the NCA had obtained the order following an investigation which relates to residential properties owned by an alleged member of the paramilitary group, his partner and associates, with the properties allegedly purchased using the proceeds of illegal money lending, mortgage fraud, money laundering and tax evasion.

https://www.nationalcrimeagency.gov.uk/news/nca-secures-property-allegedly-linked-to-south-east-antrim-uda

SHIPPING INSURANCE MUTUALS URGE CONTAINER SHIPPING INDUSTRY TO GIVE EVER MORE SERIOUS ATTENTION TO THE CAUSES AND CONSEQUENCES OF SHIP FIRES, JOINTLY ISSUING A GUIDE OUTLINING THE RESPONSIBILITIES OF ALL STAKEHOLDERS IN REDUCING RISK

On 23 January, Lloyds Loading List reported that the UK P&I and TT Club, have collaborated in publishing guidelines under the title, Book it Right and Pack it Tight.  Free of charge, it provides key insights for all actors in the freight supply chain responsible for preparing unitised consignments for carriage by sea. It gives an overview of the practical duties and responsibilities under the IMDG Code for each stakeholder, according to a joint statement.

https://www.lloydsloadinglist.com/freight-directory/news/‘Book-it-right-and-pack-it-tight’/75860.htm#.XiocN25FzIU

Vessel-Fires_Full

https://www.freightwaves.com/news/fires-on-the-ocean

23 ARRESTS IN FRANCE AND NETHERLANDS AS IRAQI-KURDISH SMUGGLING NETWORK BUSTED

A news release from Eurojust on 23 January reported that the French Border Guard together with the French National Police and the  Dutch Royal Marechaussee, supported by Europol and Eurojust, dismantled a large criminal network suspected of having facilitated the transportation of around 10,000 Afghan, Iranian, Iraqi-Kurdish and Syrian migrants from the French areas of Le Mans and Poitiers to the UK. The migrants were transported in life-threatening conditions, concealed in refrigerated – often-overcrowded – lorries.

https://www.europol.europa.eu/newsroom/news/23-arrests-in-france-and-netherlands-iraqi-kurdish-smuggling-network-busted

BALKANS: OPERATION THESEUS BUSTS HUMAN TRAFFICKING AND MIGRANT SMUGGLING RINGS

A news release from Interpol on 23 January advised that authorities in the Balkans have dealt a blow to organised crime groups by arresting 72 suspected traffickers and 167 migrant smugglers in an INTERPOL-led operation codenamed Theseus.  The operation saw 3,000 officers from immigration, justice and specialised units dispatched to hotspots including border points, train and bus stations and entertainment districts.  Trafficking victims, who were from 14 different countries, were found working in precarious conditions of sexual exploitation, forced labour and forced begging.  Authorities also confiscated nautical equipment including 30 smuggling vessels, 200 inflatable boats and buoys.

https://www.interpol.int/News-and-Events/News/2020/Balkans-Operation-Theseus-busts-human-trafficking-and-migrant-smuggling-rings

12 ARRESTS IN BIG BUST AGAINST DRUG TRAFFICKERS IN CANARY ISLANDS

On 23 January, a news release from Europol advised that a large-scale drug trafficking organisation linked to Colombian and Peruvian cartels was dismantled in Spain and Colombia in an international law enforcement operation. Europol supported the 2-year-long investigation, led by the Spanish Civil Guard in close collaboration with the National Police of Colombia and the DEA. In total, 11 Spanish nationals were arrested in Tenerife and a Colombian national in Colombia.  €2 million in assets have been seized so far.  The investigation was triggered by information on large cash movements in Tenerife, money laundering-related intelligence shared via international cooperation.  The suspects concealed the drugs in caravans travelling between the Canary Islands.

https://www.europol.europa.eu/newsroom/news/cocaine-caravans-immobilised-12-arrests-in-big-bust-against-drug-traffickers-in-canary-islands

SOUTH AFRICA: SARS TARGETS ILLICIT TRADERS INCLUDING IMPORTERS AND EXPORTERS

On 23 January, All Africa reported that SARS is said to have found that importers and exporters were using various ways to avoid paying the import/export duties. The traders are also employing tactics to avoid paying VAT that applies to the goods.  Under-declaration of customs value in this sector is said to have increased from R5.2 billion in 2014 to R8.52 billion in 2018, with the under-declared customs value in 2017 and 2018 representing 34% and 35% of the declared customs value respectively.

https://allafrica.com/stories/202001230871.html

HONG KONG CUSTOMS BUSTS LARGEST CANNABIS TRAFFICKING IN 10 YEARS AT AIRPORT

ECNS in China on 23 January reported that Hong Kong customs seized about 70 kg of suspected cannabis buds at Hong Kong International Airport which arrived from Canada, the largest cannabis trafficking case detected by the customs at the airport in the past decade.

http://www.ecns.cn/news/2020-01-23/detail-ifzsyram6090525.shtml

SEIZURE OF TONS OF STOLEN COPPER NEAR SANTIAGO SET TO BE SENT ILLEGALLY FROM CHILE TO CHINA

An article from Insight Crime on 23 January says that robberies may be fuelled by China’s thirst for the mineral.  On 13 January, over 50 tons of copper cables were seized from a company with an estimated value of $250 million.  The copper was to be smuggled to China as shown by falsified documentation found during the raid.

https://www.insightcrime.org/news/brief/chile-copper-china-demand/

PUBLIC ACCESS IS CRITICAL FOR UBO REGISTER SUCCESS

A blog post on the FCPA Blog on 23 January is by the Director for Transparency and Accountability at The ONE Campaign, an international advocacy and campaigning organisation working to end extreme poverty in Africa.  He says that, despite their current shortcomings, it’s abundantly clear that public UBO registers are a critical tool for combating increasingly complex crime and corruption, including ending the use of anonymous companies. Public information about company ownership offers a practical tool for investigation and creates grounds for optimism – bolstering people’s trust that the global financial system can operate fairly – and helps build a more level playing field for business.

https://fcpablog.com/2020/01/23/public-access-is-critical-for-ubo-register-success/

FISHERMEN KIDNAPPED BETWEEN PHILIPPINES AND MALAYSIA

On 23 January, Insurance Marine News reported that 6 gunmen dressed in black suits with masks used a twin-engine grey speedboat to abduct 8 crew from a Malaysia-registered fishing trawler.  The fishing trawler was found abandoned and with no crew on board.

https://insurancemarinenews.com/insurance-marine-news/fishermen-kidnapped-between-philippines-and-malaysia/

 

 

 

 

TAX AUTHORITIES FROM THE UK, US, CANADA, AUSTRALIA, AND THE NETHERLANDS COMBINE FORCES TO PUT A STOP TO THE SUSPECTED FACILITATION OF OFFSHORE TAX EVASION

An article in Forbes on 23 January reported on an operation which was part of a series of investigations into an international financial institution located in Central America, whose products and services may have been used in a money laundering and tax evasion scheme for customers across the globe.  The “coordinated day of action” involved evidence, intelligence, and information collection activities such as search warrants, interviews, and subpoenas – said to be the first use by the so-called J5 (the Joint Chiefs of Global Tax Enforcement, established in 2018, with membership which includes the heads of tax crime and senior officials in tax agencies) of such powers on a global scale.  The name of the targeted financial institution was not revealed, but it is said that some tax professionals believe that the investigation is linked to the Panama Papers (though this suggestion is disputed).

https://www.forbes.com/sites/kellyphillipserb/2020/01/23/tax-chiefs-combine-forces-in-global-tax-evasion-fight/

https://www.theguardian.com/world/2020/jan/24/australian-clients-to-get-scary-letters-in-tax-crackdown-on-multinational

KYRGYZSTAN: AML/CFT ASSESSMENT FOLLOW-UP REPORT

On 23 January, FATF published the follow-up report on Kyrgyzstan undertaken by the FATF-style regional body, EAG.  A number of ratings for FATF Recommendations have been uprated since the mutual evaluation report was published in 2018 –

  • The ratings for R.12, R.17 and R.28 are upgraded from Non-Compliant to Largely Compliant;
  • The ratings for R.1, R.2, R.16, R.22, R.23, R.24, R.34 and R.38 are upgraded from Partly Compliant to Largely Compliant;
  • The rating for R.7 is upgraded from Partly C to Compliant; and
  • The rating for R.6 is upgraded from Largely Compliant to Compliant.

As usual with such follow-up reports, only technical compliance is examined – not effectiveness.  Kyrgyzstan will remain in the enhanced follow-up process and will continue to report to the EAG on progress to strengthen its national AML/CFT system.

kyrgyz

http://www.fatf-gafi.org/publications/mutualevaluations/documents/fur2-kyrgyzstan-2019.html

OFAC ADDS 2 INDIVIDUALS AND 6 ENTITIES TO IRAN SANCTIONS LIST

On 23 January, OFAC announced an Iranian and Chinese individual, and 3 Hong Kong, 1 UAE and 2 Chinese companies had been added to the Iran sanctions lists.  They are said to be part of a network supporting Iran’s Petroleum and petrochemical industries.  The OFAC action in part targets Triliance Petrochemical Co Ltd, a Hong Kong-based broker with branches in Iran, UAE, China, and Germany, and notes that its Iranian branch, Triliance Kish Petrochemical Company, recently changed its name and operates as Tiba Parsian Kish Petrochemical.

https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20200123.aspx

https://home.treasury.gov/news/press-releases/sm885

CORRUPTION SEEN AS WORSENING OR STAGNATING IN MOST NATIONS

On 23 January, the 2019 Corruption Perceptions Index (CPI) was published by Transparency International, finding that 4 G7 nations — Canada, France, UK and US — are viewed as more susceptible to public-sector malfeasance than they were in the previous year.  In addition, Australia, Canada and Nicaragua are among 21 nations that “significantly declined” in their CPI rankings from the previous year, but improvements for Estonia, Greece and Guyana.  New Zealand has top spot.

https://www.transparency.org/cpi2019

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OTHER THINGS YOU MAY HAVE MISSED – JANUARY 22

22 January 2020

 FEWER SHELL COMPANIES IN THE NETHERLANDS, AS REGULATIONS BEGIN TO BITE

On 21 January, Dutch News reported that the number of letterbox, or shell, companies registered in the Netherlands has fallen by almost one third over the past 5 years, with tougher rules for trust offices and more stringent supervision by the central bank.  In 2014 there were 25,000, a number down to 17,000 by the end of 2018.  It is said that customers are leaving trust offices because of increased demands and the rising cost of compliance and transaction monitoring.
https://www.dutchnews.nl/news/2020/01/fewer-letterbox-companies-in-the-netherlands-as-regulations-begin-to-bite/

NIGERIA CHARGES EX-ATTORNEY GENERAL WITH FINANCIAL CRIMES IN $1.3 BILLION OIL DEAL

On 21 January, Reuters reported that an international investigation into the 2011 sale of the offshore oilfield known as OPL 245 by Malabu Oil and Gas has entangled 2 of the industry’s biggest players, Shell and Eni.  Mohammed Adoke, Nigeria’s ex-attorney general, has been charged with receiving bribes in 2013 to facilitate the OPL 245 deal and help waive taxes for Shell and Eni.

https://uk.reuters.com/article/us-nigeria-oil/nigeria-charges-ex-attorney-general-with-financial-crimes-in-1-3-billion-oil-deal-idUKKBN1ZK11U

 

2020: NEW INSOLVENCY LAW CHANGES FOR GUERNSEY

On 15 January, Ogier published an article about the Companies (Guernsey) Law 2008 (Insolvency) (Amendment) Ordinance 2020, which was published on 15 January.  It says that the new legislation is set to modernise Guernsey insolvency law, bringing the jurisdiction into line with not only the UK but other offshore jurisdictions such as the BVI and the Cayman Islands, and will affect all new liquidations and administrations.  The article outlines the new law and its likely effects.

https://www.ogier.com/publications/2020-heralds-new-insolvency-law-changes-for-guernsey

AUSTRALIAN 2019 LAW TARGETING CORPORATE MISCONDUCT AND FOREIGN BRIBERY

On 21 January, law firm Hogan Lovells published an article about the Crimes Legislation Amendment (Combatting Corporate Crimes) Bill 2019.  It says that the Bill replaces a former Bill, and followed detailed consultation in 2017, with the intention to strengthen Australia’s corporate crime framework and bring Australia into line with the regimes in the US and UK which have already taken significant steps to combat foreign bribery.  The Bill is designed to improve authorities’ track record in combating corporate misconduct.  The Bill would introduce deferred prosecution agreements (DPA) and a “failing to prevent” bribery offence, with an associated “adequate defences” defence – as in the UK Bribery Act 2010.  The Bill would also introduce a new definition of dishonesty as “dishonest according to the standards of ordinary people”.  It would broaden what is a bribery to include that intended to obtain a personal advantage, and not just business or a business advantage.

https://www.hoganlovells.com/~/media/hogan-lovells/pdf/2020-pdfs/2020_01_21_australian-government-introduces-crimes-legislation-amendment.pdf?la=en

NORWEGIAN POLICE INVESTIGATING ACADEMICS FOR EXPOSING TECHNOLOGY TO IRANIAN VISITORS

Radio Farda on 22 January reported that Norwegian Police Security Service (PST) has charged 2 researchers of the Norwegian University of Science and Technology (NTNU) on suspicion of sharing sensitive information with Iran that may contribute to the production of WMD or their means of delivery.  It is said that they invited a group of visiting scientists from Iran in the spring of 2019 and 2 Iranian researchers were allegedly allowed unauthorised access to computer systems and a high-tech lab.

https://en.radiofarda.com/a/norwegian-police-investigating-academics-for-exposing-technology-to-iranian-visitors/30391282.html

WHAT FATF RECOMMENDATION 16 MEANS FOR THE CRYPTO INDUSTRY

On 22 January, Regulation Asia carried an article arguing that implementing strict KYC processes to comply with the ‘travel rule’ may be costly, but it is a necessary sacrifice to build a stronger industry in the long-run.  FATF Recommendation 16, aka the “travel rule”, which is expected to be enforced by mid-2020 across 200 global jurisdictions that follow FATF AML/CFT standards.  Operators will be required to exchange and hold personally identifiable information (PII) to each other when transferring crypto assets — a move that some in the industry fear will alienate its more libertarian users.

https://www.regulationasia.com/what-fatf-recommendation-16-means-for-the-crypto-industry/

COMPLYING WITH US EXPORT CONTROL AND IMMIGRATION AND ANTI-DISCRIMINATION LAWS 

This article from Torres Law on 16 January says that the intersection of immigration, anti-discrimination, and US export control laws can be confusing for employers and the DoJ will not tolerate employers discriminating against non-US persons.  This article provides an overview of the intersection, and friction between, US immigration, anti-discrimination, and export control laws and regulations.  It concludes that recent cases demonstrate that employers cannot seek to comply with US export control laws by instituting a US person- or US citizen-only hiring policy when a position involves working with export-controlled items/information and, more generally, may not discriminate in their application of citizenship verification processes.  The article briefly offers a selection of best practices.

http://www.torrestradelaw.com/posts/Complying-with-U.S.-Export-Control-and-Immigration-and-Anti-045%3BDiscrimination-Laws/190

ENSURING US IMPORT COMPLIANCE WITH SPOT-CHECK AUDITS OF CARRIER BILLING STATEMENTS

An article from Torres Law on 16 January says that that auditing internal trade compliance processes is a necessary method of maintaining healthy trade controls and avoiding costly penalties – and that sometimes a focused spot check can be very revealing.  Under the import laws in the US the responsibility for ensuring accuracy of the import information falls squarely on the shoulders of the importer of record.  Failure to accurately report import information can result in significant civil fines and even criminal penalties.  The article briefly explains how to carry out a spot-check audit, and what to do if you find an error.

http://www.torrestradelaw.com/posts/Ensure-Import-Compliance-with-Spot-045%3BCheck-Audits-of-Carrier-Billing-Statements/189

FIFTH EU MONEY LAUNDERING DIRECTIVE: ELECTRONIC IDENTIFICATION USING A TRUST SCHEME (EIDAS)

A blog from Lexis Nexis Risk Solutions on 17 January said that the EU Directive described a significant new option for electronic identification by using a “trust scheme” that complies with EU Regulation 910/2114 on electronic transactions and trust services for electronic transactions (aka eIDAS).  In the UK, the regulations implementing the Directive allow for the use of such a trust scheme.  Using a trust scheme means an individual has a “digital identity”, and is able to identify themselves using an online service – instead of having to prove their identity by mail or in person each time.  An routine and simple example in the non-compliance world is given as being able to sign into other websites and services using your Facebook identity – the trust scheme for compliance purposes requiring strict identity-proving requirements.  The blog post says that updated guidance on electronic identification from the UK Joint Money Laundering Steering Group is expected soon.  In its conclusions, the post says that systems already in place for the purposes of the 4th ML Directive are still suitable for the requirements of the 5th ML Directive, and that in the UK the only system that meets the requirements of eIDAS is the Gov.uk Verify system.

https://risk.lexisnexis.co.uk/insights-resources/article/5mld-eidas-electronic-identification-using-a-trust-service

For more information on Gov.uk Verify (which I myself have used, and found quite easy and painless to use) see –

https://www.gov.uk/government/publications/introducing-govuk-verify/introducing-govuk-verify

IMPORTING INTO THE US MADE A (MORE) RISKY BUSINESS?

Law firm Crowell & Moring on 22 January published an article saying that for companies that import goods into the US, increased tariffs have made business much more complicated and expensive.  They are also bringing risk on the legal front.  It refers to a May 2019 case where charges of violating the False Claims Act by understating the value of imported goods to avoid duties, thus costing the government more than $1 million in revenue, arose from a whistleblower claim.  The firm says that, with the Trump administration’s protectionist policies and increased scrutiny on making sure duties are paid, it anticipates seeing the government taking up more of these FCA cases.

https://www.crowell.com/NewsEvents/Litigation-Forecast/2020/Articles/Trade-Importing-Risky-Business

UK AMENDS TERRORISM SANCTIONS ENTRY FOR (THE LATE) QASEM SOLEIMANI

On 22 January, a Notice from HM Treasury advised that the entry relating to Qasem SOLEIMANI had been amended in line with changes made to EU sanctions lists.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/859722/Notice_TAFA_2020_19.pdf

PODCAST: 2019 FCPA YEAR IN REVIEW

In the latest TRACE podcast, Jeff Clark, a partner with Willkie Farr & Gallagher and well-known to TRACE members, provides an excellent summary of US foreign anti-bribery activity in 2019.

https://traceinternational.org/resources-podcast

GENERAL ELECTRIC GRANTED A US LICENCE FOR ASSISTANCE IN THE INVESTIGATION OF THE UKRAINIAN JET SHOT DOWN IN TEHRAN ON 8 JANUARY

On 22 January, the EU Sanctions blog reported that GE has been granted a licence from the US Treasury to authorise its assistance in the investigation of the Ukrainian jet PS752, as GE co-owns (with French company Safran) CFM International, which made the engines.

https://www.europeansanctions.com/2020/01/ge-granted-us-licence-for-ukrainian-plane-crash-investigation/

 

 

HOW UK MUSEUMS AND GALLERIES CAN ARRANGE TO PROTECT EXHIBITS ON LOAN FROM ABROAD FROM COURT-ORDERED SEIZURE

On 22 January, the Department of Digital, Culture, Media and Sport issued updated information saying that objects on loan from abroad in temporary exhibitions in UK museums are protected from seizure by the UK courts when they are on display in a museum or gallery which has been approved by the Culture Secretary and where the museum or gallery has published information about the objects on loan.  Such protection is provided because the ownership of art can be disputed and many other countries will not lend to the UK without this protection.  The guide explains the application process and conditions which must be met by participating institutions, and also includes a list of museums and galleries which have already received approval.

https://www.gov.uk/guidance/protecting-cultural-objects-on-loan

IRANIAN CYBER ESPIONAGE GROUP TARGETS SUPPLIERS OF INDUSTRIAL CONTROL SYSTEMS

On 22 January, Control Risks reported that in November security researchers said that an Iran-linked unit had shifted its targeting focus from espionage and data-wiping campaigns to IT networks.  Now the group increasingly targets the suppliers and manufacturers of industrial control systems (ICS) used in electric utilities, manufacturing, and oil refineries.  This is said to have implications for organisations globally that are using such systems, particularly in the energy, oil and gas, maritime and manufacturing sectors.  Organisations with a strong presence in, or links to, such industries in the Middle East, particularly in Saudi Arabia, the UAE and Bahrain likely face a heightened threat.

https://www.controlrisks.com/our-thinking/insights/iranian-cyber-espionage-group-targets-suppliers-of-industrial-control-systems

LATIN AMERICA’S TOP 10 CRIMINAL GROUPS

Insight Crime on 22 January carried an article which says that Colombia’s last rebel army (Ejército de Liberación Nacional – ELN) is now the most powerful criminal syndicate in Latin America, as it expands across Colombia and far into Venezuela, deepening its involvement in the drug trade.  It then provides a list of criminal organisations in the country, being non-state illegal actors (i.e. not those governments where organised crime has penetrated the highest echelons and put state assets at the service of criminal activity, such as Venezuela and arguably, Honduras).  It also lists the indicators used to measure and compare such criminal groups.

Top-10-Criminal-Groups-2019_Map_InSight-Crime_06-01-2020-1

https://www.insightcrime.org/news/analysis/gamechangers-2019-top-10-criminal-groups/

FORMER HEAD OF DRUG COMPANY SENTENCED IN BRIBERY CASE RE SCHEME THAT PROSECUTORS SAY HELPED FUEL THE OPIOID CRISIS

On 22 January, KSL.com reported that Michael Babich, who was CEO of Insys Therapeutics, was sentenced to 2½ years in Boston and that employees for Arizona-based Insys paid millions of dollars in bribes to doctors nationwide to overprescribe Subsys, a powerful, addictive fentanyl-based painkiller for cancer patients.  The article says that the case was considered the first to hold an opioid maker and its executives criminally liable for a nationwide drug crisis that has claimed nearly 400,000 lives over 2 decades.

https://www.ksl.com/article/46707959/ex-pharma-ceo-gets-over-2-years-in-prison-for-bribery-scheme

SNC-LAVALIN DROPS COURT CHALLENGE OVER BID FOR SPECIAL AGREEMENT TO AVOID CRIMINAL PROCEEDINGS ON CORRUPTION AND FRAUD CHARGES

The Star on 22 January reported that this means legal questions about the nature and extent of the prosecution service’s authority won’t be examined further by the courts. In 2015, SNC-Lavalin Group and 2 of its affiliates were charged with corruption of a foreign public official and fraud stemming from business dealings in Libya, and it had unsuccessfully pressed for a special settlement — known as a remediation agreement — out of concern the company could be barred from federal contracts for a decade if convicted of criminal charges.

https://www.thestar.com/news/canada/2020/01/22/snc-lavalin-drops-court-challenge-over-bid-for-special-agreement-to-avoid-criminal-proceedings.html

SWISS RETURN SEIZED FUNDS TO TURKMENISTAN

On 15 January, Swissinfo reported that Switzerland says it is repatriating $1.3 million in seized assets to Turkmenistan.  The funds will be paid towards a health project run by the UN Development Programme (UNDP), and will be used to purchase anti-TB drugs.

https://www.swissinfo.ch/eng/illicit-assets_swiss-return-seized-funds-to-turkmenistan/45495348