22 February 2020
ALBANIA UNDER SPECIAL FATF MONITORING
On 22 February, Albania Daily News reported on the increased monitoring regime imposed this week on Albania, and the steps made already by the country to improve its AML/CFT regime.
US COAST GUARD COMMANDANT: ILLEGAL CHINESE FISHING A ‘NATIONAL SECURITY CHALLENGE’ THAT WARRANTS US RESPONSE
On 21 February, Sea Power (the official publication of the Navy League) reported on the State of the Coast Guard address given by the Commandant. He said that near-peer adversaries (i.e. China) are actively exploiting other nations’ natural resources, including fish stocks. In many cases [they are] challenging the sovereignty of smaller or less-developed nations. He identified China, which has the world’s largest distant-water fishing fleet, as “one of the worst predatory fishing offenders,” engaging in Illegal, unreported, unregulated fishing (IUU). He identified the Indo-Pacific as the epicentre of global maritime trade and geostrategic influence, and that many Pacific Island countries — even US island territories — lack the capability to fully police their sovereign waters.
SHIPPING INDUSTRY FACES $370 MILLION HIT FROM NEW PANAMA CANAL CHARGE
On 22 February, Hellenic Shipping News reported on the new “freshwater” charge that came in this month to help the Panama Canal cope with climate change, as the Canal has been hit by drought which affects water levels.
HOW DO YOU CALCULATE FCPA SETTLEMENT AMOUNTS?
On 21 February, a post on the FCPA Blog was concerned with how the recent Airbus settlement was calculated, saying that the starting point is DOJ Order + SEC Order = Total FCPA Settlement – but the total FCPA settlement amount is not the same as the amount actually paid to the US Treasury. The amount paid over to the US government may be considerably smaller.
US STATE DEPARTMENT SANCTIONS 13 SUSPECTED IN 1989 SLAYING OF JESUITS IN EL SALVADOR. WHY NOW?
America: the Jesuit Review has published an article on 21 February about the 29 January State Department designating 13 military personnel for involvement in gross violations of human rights or significant corruption. They and their families are banned from entering the US. In particular, the designation mentioned the extrajudicial killings of 6 Jesuit priests and 2 others taking refuge at the Jesuit pastoral centre in 1989 on the campus of the José Simeón Cañas] Central American University in El Salvador. It has been confirmed that the bans were triggered by a routine investigation after “an individual connected to this incident sought to travel to the United States”.
ROMANIAN COASTGUARD SEIZES RUBBISH ‘SMUGGLED’ FROM THE UK
On 22 February, CGTN reported that 17 shipping containers, some bearing the brand of Maersk Sealand, the waste – and believed to be of British origin, were intercepted in the Romanian port of Constanța. Sources close to the investigation say they believe the waste started its journey in Sheffield in northern England in December, before being shipped to Turkey and then to Romania. It is described as the latest in a tide of rubbish that has been flooding Romania in recent years, where storage of waste costs a fraction of what it would in richer countries, that have stricter legislation.
MAJORCA MILLIONAIRE INVESTIGATED
The Majorca Daily Bulletin on 22 February reported that an unnamed millionaire in Majorca is under investigation after police assisted by the EU Europol agency raided the suspect’s home and office in connection with the sale of property.
CROATIA’S HONORARY CONSUL IN BARCELONA (AND OTHER HONORARY CONSULS) “UNDER INVESTIGATION FOR MONEY LAUNDERING”
On 22 February, Total Croatia News reported that Catalan police are investigating Croatia’s honorary consul in Barcelona over possible money laundering for a local criminal gang. It says that also under investigation are the honorary consuls of Albania and Mali.
EGYPT COURT ACQUITS FORMER PRESIDENT’S SONS OF CORRUPTION
On 22 February, AP reported that an Egyptian court has acquitted the 2 sons of ousted President Hosni Mubarak – wealthy businessman Alaa and Mubarak’s one-time heir apparent Gamal – on charges of stock market manipulation, the latest in a series of trials of Mubarak’s family since the 2011.
UK BASIC PASSPORT CHECKS GUIDANCE
On 22 February, HM Passport Office published an updated colour booklet containing important information of what to expect, plus additional notes for the 1988, 1998, 2006, 2010 and 2015 versions of the UK passport.
THE FEDERAL CASE AGAINST THE IRANIAN NATIONAL WHO OWNED AND OPERATED MALTA’S PILATUS BANK, AI SADR HASHEMI NEJAD, HAS BEEN SET TO BEGIN ON 2 MARCH
On 22 February, Kenneth Rijock in his blog reported that the case will open in the US after preliminary motions were resolved.
IN “FAKE FRENCH DEFENCE MINISTER” CASE TRADE-BASED MONEY LAUNDERING EMPLOYED
On 22 February, in his blog, Kenneth Rijock reported (and provided a complex illustrative diagram) that Gilbert Chikli, leader of a French gang that defrauded wealthy individuals of a reported €73 million, by impersonating the Minister of Defence, and asking for ransom money to free purported kidnap victims in Syria, used trade-based money laundering techniques to clean the criminal proceeds. He refers to one method, a variant known as Chinese Flying Money, and the diagram illustrates this method.
VESSELS CALLING AT CHINESE PORTS – DELAYS IN DISCHARGING BECAUSE ORIGINAL BILLS OF LADING HAVE NOT REACHED THE DISCHARGE PORT ON TIME DUE TO DIFFICULTIES WITH LOCAL COURIER SERVICES DUE TO CORONAVIRUS
On 19 February, a briefing from HFW says that in such cases, when vessels are voyage chartered, delays may result in large demurrage liabilities – costs which may or may not be capable of being passed on, and that the shipping industry will be keen to find a solution to prolonged document delays. It says that the use of letters of indemnity (LOIs) is a well-established solution to the problem of discharging a vessel without production of an original bill of lading – but these are not without risk, which it goes into.
FIRST RUSSIAN ONLINE RETAIL GIANT TO TARGET EU BUYERS
On 21 February, HKTDC carried an article about Wildberries, Russia’s largest online retailer, opening its first EU-specific sales point; and with dispatch from Poland using a new, dedicated site that features the merchandise on offer from 13,500 Russian and overseas brands, including a wide range of clothing, footwear, accessories and toys. In September, it announced a 300,000 sq m warehouse facility in Slovakia.
DEA AGENT ACCUSED OF CONSPIRING WITH DRUGS CARTEL
Newsweek and others on 22 February that a once-standout US federal narcotics agent, Jose Irizarry, and his wife, were arrested, having become known for spending lavishly on luxury cars and Tiffany jewellery. He faces charges of conspiring to launder money with the same Colombian drug cartel he was supposed to be fighting.
NAMIBIA: NEW CHARGES FOR THE FISHROT ACCUSED
All Africa on 19 February reported that suspended Fishcor CEO Mike Nghipunya has been joined by 5 other co-accused in court in Windhoek in the unfolding international fishing bribery scandal. He is facing 3 charges, including fraud, contravening the Anti-Corruption Act and corruptly using office for gratification as well as money laundering. The other accused included former fisheries minister Bernhard Esau and ex-justice minister Sacky Shanghala, The 5 were in court to face new charges, with regards to the alleged corruption at the State-owned fishing company Fishcor. The accused were arrested last year following reports that an Icelandic fishing company Samherji secured access to horse mackerel quotas in Namibia by allegedly paying bribes to politicians and businessmen between 2012 and 2018, according to the Fishrot Files of WikiLeaks.
IRELAND: GARDAI INVESTIGATING VIOLENCE AGAINST A COMPANY UNCOVERED A NETWORK OF FRONT COMPANIES AND BANK ACCOUNTS USED TO LAUNDER MONIES PAID TO A SENIOR CRIMINAL
On 22 February, the Belfast Telegraph reported that police in the Republic investigating violence against Quinn Industrial Holdings (QIH) have uncovered a network of front companies, ostensibly set up to buy and sell plant machinery, and bank accounts used to launder monies paid to senior criminal Cyril McGuinness.
SPAIN: NEW RULES WILL PROHIBIT 80% OF ONLINE GAMBLING ADVERTS
On 21 February, Calvin Ayre reported that Spain’s online gambling operators have learned of over 100 new restrictions on their ability to promote their services. The new rules would likely prohibit around 80% of current online gambling ads, and a minister justified the curbs due to the gambling sector having “an impact on public health”. Other restrictions on advertising are proposed, although they will apparently be permitted to run in print media and via legitimate news media websites, provided that they adhere to all the other rules.
IRELAND: NEW FILING/DISCLOSURE OBLIGATIONS FOR PARTNERSHIPS AND LIMITED PARTNERSHIPS
On 10 February, Matheson published a briefing about changes to existing disclosure obligations that apply to partnerships and limited partnerships in Ireland needed to align Irish with EU law. It says that this change will be particularly important for certain partnerships whose partners are incorporated or established outside of the EU (e.g. in the Isle of Man or Jersey) that were not previously required to file annual returns or accounts.
US TO RELAX NORTH KOREAN SANCTIONS TO ALLOW CORONAVIRUS AID
World ECR reports that the US State Department has said that the US will allow aid organisations working in North Korea to sidestep sanctions in order to fight the Covid-19 coronavirus. The State Department announcement came after the International Federation of Red Cross and Red Crescent Societies called for a sanctions exemption that would allow it to transfer funds to its North Korea office.
AS THE UK HAS OFFICIALLY LEFT THE EU WHAT DOES THIS MEAN FOR DATA TRANSFERS?
An article from law firm Field Fisher on 20 February addresses this question. Of course, during the transition until 31 December nothing changes and personal data can continue to flow freely from the EEA to the UK. At the end of the transition period the UK will become a “third country” for the purposes of the GDPR and, to ensure that data flows from the EEA to the UK are not disrupted, the UK will need to secure an adequacy decision from the European Commission. The law firm takes a look at how the Commission determines adequacy and the UK’s prospects of securing that haloed status.
ITAR FIREARMS AMENDMENTS – 6 IMPORTANT POINTS YOU NEED TO KNOW
On 6 February, a briefing from Williams Mullen provided a list of 6 important points about the January transfer of certain firearms, ammunition, components and accessories from controls under the International Traffic in Arms Regulations (ITAR) to the Export Administration Regulations (EAR).
PREVENTING ILLICIT TRAFFICKING BY TRANSNATIONAL CRIMINAL ORGANISATIONS
The Stimson Center in the US has produced this brief as part of ongoing series examining the international challenges that will face the next US presidential administration and providing concrete recommendations for presidential action. The brief says that existing efforts to address trafficking are disaggregated and fail to involve legitimate industry as partners in prevention. The US President should, it says, catalogue the threat, better target government resources, and incentivise legitimate business to do more to help prevent illicit trafficking at home and abroad. It argues that although both the Obama and Trump administrations prioritised federal efforts to meet the growing spectre of illicit trafficking, both failed to go beyond government-oriented solutions to what has become a far more complex challenge. Beyond lip service and intermittent efforts to build “public private partnerships,” the US has fundamentally failed to alter the calculus of both legitimate and illicit actors operating in the global supply chain. It says that government must do its part to change the current ‘low-risk high-rewards calculus’ for those operating in the illicit space, and do more to incentivise legitimate companies to partner in countering illicit trade. It makes a number of policy recommendations –
- Comprehensively chart the global grey market to identify common choke points;
- Dedicate a greater share of intelligence and interagency resources to identifying and disrupting factors that enable illicit middlemen in the global supply chain; and
- Enlist support of the legitimate supply chain companies.
THE FRENCH LIST OF NON-COOPERATIVE STATES AND TERRITORIES IS COMPLETELY OVERHAULED
On 13 February, Baker McKenzie published a briefing on the list which has been extensively overhauled: with the exception of Panama, all the jurisdictions have been withdrawn from the list, while 12 new states or territories have been added. It explains the criteria and the restrictive tax measures applied.
GEORGIA: MINISTRY OF FINANCE PRESENTS NEW INITIATIVE TO REDUCE MONEY LAUNDERING RISKS RELATED TO GAMBLING
On 20 February, Agenda GE reported that the initiative includes the implementation of a new system for the registration and verification of the identity of players; and it aims to create a list of people addicted to gambling and to control the movement of funds through identified channels.
ITALY ARRESTS SHIP’S CAPTAIN OVER ALLEGED LIBYA ARMS TRAFFICKING
On 21 February, Reuters reported that Italian authorities have arrested the captain of a Lebanese-flagged cargo ship, the Bana, which was seized on 3 February in the port of Genoa on suspicion of trafficking arms to Libya, including tanks and artillery, It is said that a ship’s officer told Italian authorities that weapons had been loaded onto the ship at the Turkish port of Mersin then transported to the Libyan capital Tripoli.
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