27 February 2020
GULNARA KARIMOVA, IMPRISONED DAUGHTER OF LATE UZBEK PRESIDENT, HAS OFFERED TO RETURN $686 MILLION END CASE
On 26 February, Rferl reported that Gulnara Karimova, the imprisoned eldest daughter of the late Uzbek President Islam Karimov, has offered to return $686 million to the country’s treasury in exchange for closure in the latest court case against her.
OVER A DOZEN ROMANIAN BANKS PROBED FOR MONEY LAUNDERING
On 27 February, Romania Insider reported that the central bank had said it is investigating 16-17 local banks for an “awkward transaction” related to money laundering. In at least one case, money from the Danske Bank scandal passed through a local bank.
RISE OF THE EAST AFRICA CATTLE SMUGGLING CARTELS
A news release from ENACT Africa on 27 February says that cattle rustling has been commercialised by international criminal networks in East Africa, aided by a proliferation of small weapons. This, it says, undermines development and has caused multiple deaths among rural communities and security forces. In the region, small-scale farmers are the backbone of the regional beef industry but find their livelihoods threatened by criminals who supply stolen beef to growing urban meat markets. A new report shows how cattle rustling characterised by high-intensity conflicts has left dozens killed or maimed in 2017 and 2018. The report outlines the impact of these crimes on human security and development in the region, and how the problem can be mitigated. Cattle rustling has become a form of organised crime embedded in the wider business of cattle trade. It is enabled by government corruption, with state officials turning a blind eye or collaborating with criminals; and cattle rustlers also exploit weak cross-border coordination between governments in the region.
INDIA AMONG TOP SUPPLIERS OF PHARMA DRUGS USED IN TRAFFICKING
On the 27 February, The Hindu reported that globally most of the tramadol — a controlled substance — seized between 2013 and 2017 was reported to have originated in India. According to the 2019 report of the International Narcotics Control Board (INCB), released by United Nations Office of Drugs and Crime (UNODC), India features prominently among top manufacturers of illicit and licit drugs that are smuggled to other countries and into the hands of addicts.
US TREASURY DEPARTMENT LIFTS SANCTIONS AGAINST FORMER ISRAELI GENERAL ZIV
The Jerusalem Post on 27 February said that Israel Ziv was sanctioned in December 2018 over accusations of selling arms to South Sudanese during its civil war. Ziv and his company Global CST were designated following allegations that he sold millions of dollars of arms to South Sudan during its civil war.
SOUTH AFRICANS AND LOOMING EXPAT TAX
On 27 February, International Adviser reported that the recent South African budget statement mentioned, in just 2 paragraphs, a so-called “expat tax”. From 1 March, South African tax residents working in another country will be liable to pay the Revenue Service (Sars) for money earned abroad – although the budget did lift the annual limit to ZAR 1.25 million, from the initially proposed ZAR 1 million (US$65,600). It is said that the Government proposes to remove the exchange control treatment for individuals, while strengthening the tax treatment, and that “the intention is to allow individuals who work abroad more flexibility, provided funds are legitimately sourced and the individual is in good standing with Sars”. The current rules allow people to transfer ZAR 10 million offshore, while this remains unchanged anyone breaching this limit “will be subjected to a more stringent verification process”, with this phased in by 1 March 2021.
REGULATORY FORECAST 2020 – HOW THE INTERNATIONAL TRADE SUPPLY CHAINS ARE CAUGHT IN THE REGULATORY CROSSFIRE
On 26 February, Crowell Moring published a report that explores the impact of regulatory changes on the technology industry and other sectors, and provides insight into what an in-house counsel can expect to face in the coming year. It highlights the driving forces behind the increased regulatory focus, including access to the data, online platforms, and cutting-edge technologies that define competitive advantage. It explores regulatory trends in antitrust, environment and natural resources, and public affairs. One chapter focuses on international trade and how the current trade conflict has created a new set of challenges for companies with supply chains reliant on China. The article is said to offer in-house counsel considerations for moving forward.
US STATE DEPARTMENT TERRORISM DESIGNATION OF AHMAD AL-HAMIDAWI
A news release from the US State Department on 26 February explained the reasons for the Department designating Ahmad al-Hamidawi a Specially Designated Global Terrorist (SDGT). Ahmad al-Hamidawi is the Secretary General of Kata’ib Hizballah (KH), an Iran-backed terrorist group active in Iraq and Syria, which the Department designated as a Foreign Terrorist Organization and SDGT in July 2009. KH has claimed responsibility for numerous terrorist attacks against U.S. and Coalition Forces in Iraq, including IED attacks, rocket-propelled grenade attacks, and sniper operations.
UK: REPORT OF THE INDEPENDENT REVIEWED OF TERRORISM LEGISLATION FOR 2018 NOT PUBLISHED
The EU Sanctions Blog on 27 February reported that the 2018 report had not been published, despite being submitted and vetted. It notes that the Home Secretary must lay a copy of the report before Parliament as soon as the Secretary of State is satisfied that doing so will not prejudice any criminal proceedings.
FORECASTING NEW TRENDS IN IRAN THREAT NETWORK FOREIGN OPERATIONS TRADECRAFT
An article in the always interesting CTC Journal from the Combating terrorism Center at West Point looks at the aftermath of the killing of the Islamic Revolutionary Guard Corps Quds Force chief. It warns that Iran and the foreign legion of Shi`a proxies at its disposal are likely to employ new types of operational tradecraft, including deploying cells comprised of operatives from various proxy groups and potentially even doing something authorities worry about but have never seen to date, namely encouraging Shi`a homegrown violent extremist terrorist attacks. One of the conclusions of the article is that the most likely scenarios for near-term operations targeting the US or its allies involve attacks on US and other forces in the region and a wide range of cyberattacks.
INTERVIEW WITH AN OFFICIAL AT EUROPOL’S EU INTERNET REFERRAL UNIT
Another article in the latest edition of the CTC Journal consists of an interview about a campaign involving Europol and the social media messaging service Telegram, which engaged in a serious disruption campaign against the Islamic State’s channels and groups on the platform, about the ongoing relationship with social media companies, and the continued challenge of combating terrorist content online. The official requested anonymity but Europol has reviewed this interview and approved its publication. He starts by explaining that the IRU was set up in 2015, to build on existing capacity within Europol (the EU police agency) to monitor and analyse terrorist propaganda, meaning jihadist propaganda, and to engage with online service providers to flag terrorist content to them and find solutions on how to disrupt the dissemination of terrorist content online.
UK: REVIEW OF DRUGS: PHASE ONE REPORT
On 27 February, the Home Office released phase one of a report which provides a detailed analysis of the challenges posed by drug supply and demand, including the ways in which drugs fuel serious violence. Professor Dame Carol Black was commissioned in February 2019 to undertake an independent review of drugs. This was to inform the UK government’s thinking on what more can be done to tackle the harm that drugs cause.
The NCA has issued a statement on the report –
AUSTRALIA: FAKE TAHITIAN PRINCE IMPRISONED OVER THE THEFT OF $16 MILLION FROM QUEENSLAND HEALTH, RELEASED AND DEPORTED TO NEW ZEALAND
On 27 February, the Canberra Times reported that fake Tahitian prince Joel Morehu-Barlow, who was imprisoned over the theft of $16 million from Queensland Health, has been released from jail and deported to New Zealand.
BRANCH OF MAJOR DUTCH BANK ABN AMRO RAIDED IN GERMAN CUM-EX SCANDAL INVESTIGATION
Deutsche Welle on 27 February reported that a Frankfurt branch of Dutch bank ABN Amro was searched in the bank’s second raid relating to the investigation. ABN Amro is also said to be under investigation for money laundering, being suspected by Dutch authorities of money laundering after failing to report suspicious transactions.
ZAMBIA SEIZES $3 MILLION BUGATTI OVER ALLEGED POSSIBLE MONEY LAUNDERING
Face2Face Africa reported on 27 February money laundering that authorities have confiscated a Bugatti Veyron imported into the country, pending investigations into possible money laundering. It has been reported that car is owned by South African- -based Zimbabwean businessman, Ian Chamunorwa Nyarungwe Haruperi.
UK: TOMMY ADAMS ORDERED TO REPAY £1.24 MILLION FOR DIRTY CASH LAUNDERING OPERATION
A CPS news release on 27 February advised that Thomas ‘Tommy’ Adams has been ordered to repay £1,243,270.75 for his part in a dirty cash laundering network. He ran a money laundering operation with his associates, which was closed down in 2014. The network was convicted of money laundering offences in two separate trials in 2017 and jailed for more than 30 years collectively. Adams, a member of a prominent south London family, has been ordered to repay the full amount of his benefit by 26 May or he will face a further 7 years in prison.
HMRC ARRESTS 5 OVER LOAN CHARGE TAX FRAUD
On 27 February, Accountancy Daily reported that 4 men and a woman have been arrested on suspicion of fraud in connection with promoting arrangements designed to avoid paying the loan charge. It is thought that the arrests involve disguised remuneration, where schemes are contrived arrangements that pay loans in place of an ordinary remuneration, usually through an offshore trust, with the purpose of avoiding income tax and NIC. The loans are provided on terms that mean they are not repaid in practice, HMRC said.
ISRAEL: 2 MORE EX-OFFICIALS TO BE INDICTED IN SUBMARINES CASE
The Times of Israel on 27 February reported that former deputy national security adviser Avriel Bar-Yosef and commander of elite naval commando unit Shay Brosh face bribery and corruption charges. The “Case 3000” investigation involves alleged corruption in the purchase of naval vessels from German shipbuilder Thyssenkrupp.
TANZANIA: RAILWAY CONSTRUCTION MANAGER FOUND GUILTY OF MONEY LAUNDERING
The Citizen on 27 February reported that a Turkish national, Yetkin Gen Mehmen, facilitation manager of the Turkish company building the Standard Gauge Railway, had been sentenced to 3 years in prison or paying a fine of around $43,000 – with $84,000, found on him at the airport as he prepared to leave the country, to be forfeited.
INDIA FINES JEWELLERY COMPANY FOR WITHHOLDING INFORMATION IN $2 BILLION PNB BANK FRAUD
On 27 February, Reuters reported that India’s securities regulator has fined jewellery retailer Gitanjali Gems Ltd and its executives $695,700 for failing to disclose key information related to a $2 billion fraud at Punjab National Bank (PNB). Gitanjali’s promoter and MD, Mehul Choksi; his nephew, billionaire jeweller Nirav Modi, and others were accused of being involved in fraudulent transactions that led to losses of roughly $2 billion for PNB. Modi was arrested in London in March last year and is currently fighting extradition to India, while Choksi, is said to be in hiding in the Caribbean.
UK GAMBLING COMMISSION FINES MR GREEN £3 MILLION FOR AML FAILINGS
On 27 February, Calvin Ayre reported that the Gambling Commission has fined operator Mr Green over failings to verify customers’ source of funds.
SERIOUS ORGANISED CRIME AND BRITAIN’S FORTHCOMING INTEGRATED REVIEW
On 27 February, RUSI published a Commentary, arguing that the government should raise the national security threat from serious and organised crime to “Tier One” status. It remarks that to date the threat has been a Tier Two threat. However, it says that it is evident that the threat is increasing in scale and complexity. It was estimated in 2015 to cost the economy £24 billion, and the latest figure, even at a conservative estimate, indicates that this figure has risen to £37 billion – a huge rise, even allowing for methodology differences.
SEVERAL MONTENEGRIN CITIZENS DETAINED AFTER ARUBA INTERCEPTED A SHIP CARRYING TONS OF COCAINE DESTINED FOR EUROPE
On 27 February, OCCRP reported that several Montenegrin citizens have been detained when authorities of the Caribbean island of Aruba intercepted a ship carrying tons of cocaine destined for Europe. The ship, Arresa, sailing under the flag of Cameroon, was intercepted near Venezuela and carried about 5 tons of cocaine with a street value of €160 million.
SHAM MARRIAGES IN EUROPE: RINGLEADER ARRESTED IN GERMANY
On 27 February, a news release from Europol reported that a cross-border criminal investigation into Indian nationals entering into bogus marriages for immigration purposes has led to the arrest in Germany of the ringleader of the network. This followed a parallel investigation for which an action day took place in Greece last year.
CAN PORT OF ANTWERP STEM THE FLOW OF COCAINE ENTERING EUROPE?
An article in Insight Crime on 27 February posed this question, saying that Antwerp has become the main entry point for cocaine into Europe, and authorities are actively trying to change that fact – but what can really be done besides continually increasing seizures of cocaine? There is a plan which brings together local and federal police, customs, prosecutors, port authorities and city officials in Antwerp. Its beefing up of port security structure is also being replicated in Latin America, in the source and transit countries. The article reflects on the difficulties being encountered by the Antwerp plan.
HONG KONG: DISCLOSURE OF BENEFICIAL OWNERS OF COUNTERPARTIES IN CORPORATE TRANSACTIONS
On 27 February, Eversheds Sutherland published a briefing saying that, after identifying shortcomings, the Securities and Futures Commission (SFC) and The Stock Exchange of Hong Kong Limited have published a series of materials to provide guidance and clarification on where rules impose certain disclosure obligations on listed issuers when they engage in different types of corporate transactions.
4 WAYS THE DoJ SIDESTEPS THE FCPA STATUTE OF LIMITATIONS
A post on the FCPA Blog on 27 February commented on how, in a recent case, the US DoJ has employed several notable legal strategies to reach the defendants’ conduct from over 18 years ago –
- the 5-year statute of limitations is generally taken from the filing of an indictment;
- the statute of limitations remains for a superseding indictment, as long as that new indictment does not substantially alter the original filing;
- the statute of limitations remains even if the indictment, immediately upon filing, is sealed and kept secret for years; and
- for conspiracy offences, the DoJ needs only prove that a single overt act in furtherance of the conspiracy occurred during the 5-year time limit, and then all parts of the conspiracy become punishable.
The post elaborates on these, arguing that the 5-year statute of limitations cannot be read literally to mean defendants should only fear legal repercussions for conduct that occurred in the last 5 years.
BERNARDO PAZ, TOP BRAZILIAN ART COLLECTOR, CLEARED OF MONEY LAUNDERING CHARGES
On 27 February, Art News reported that, after 2 years, an appeals court has cleared an eccentric art collector who built a massive sculpture park that reads as a who’s who of international contemporary art. In 2017, he was sentenced to 9 years and 3 months for money laundering related to that sculpture park, after charges brought forth in a criminal complaint by Brazil’s federal prosecutors. Paz’s sister, Virgínia de Mello Paz, was also convicted and sentenced to 5 years. The new ruling also acquitted her.
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