Panama update – 69 positive tests so far, 1 death. Panama now seemingly cut off, with no flights to/from Europe and many other places, cruise ships not allowed to disembark, cafes and restaurants closed (takeaway and home deliveries continue), large gatherings and numbers in shops and supermarkets limited… However, the weather is still glorious, and one can still enjoy that!
16 March 2020
US PAYMENTS PROVIDER MAKES PROVISION FOR FCPA PENALTIES
On 16 March, the Wall Street Journal reported that World Acceptance Corporation had made accruals of $21.7 million related to an SEC investigation into its former operations in Mexico.
CHINESE SINOCHEM AVOIDING ROSNEFT OIL DUE TO US SANCTIONS THREAT
On 16 March, Market Screener reported that China’s state oil company is rejecting any crude cargo “from or related to” Russia’s state oil major Rosneft in anticipation of US sanctions on a Rosneft unit due to take effect in May.
CAMOBODIA: 5 CASES, $8 MILLION AND 3,000 VEHICLES – AML RESULTS SINCE GREY-LISTING BY FATF
On 16 March, the Khmer Times reported that since FATF placed the country on its “grey list” for lack of AML/CFT progress, the Interior Ministry has cracked down on 75 cases, seized about $8 million and confiscated nearly 3,000 vehicles. Following the listing, Cambodian authorities are said to have ratcheted up their fight against money laundering, catching dozens of suspects at international airports and border crossing in the country. It is said that major cases involved Chinese nationals who brought the money to Cambodia via Hong Kong.
MORE ON US CASE INVOLVING ILLEGAL DOPING OF RACEHORSES – AND MONEY LAUNDERING CONSPIRACY
The Paulick Report, which covers the racing industry in the US, on 15 March, reported that 5 further men had been arrested, following the FBI charging 27 men and women in Florida and New York with an assortment of crimes related to illegally doping thoroughbred and standardbred racehorses. The money laundering charges are said to arise after undercover agents discussed with defendants ways of laundering money purportedly coming from corrupt politicians in Brazil.
LONDON FRAUD GANG JAILED AFTER 23 MILLION ILLEGAL CIGARETTES DISCOVERED AT RENTED INDUSTRIAL UNITS
My London on 16 March reported that 3 London men have been jailed after 23 million illegal cigarettes were discovered at 4 rented industrial units across the south of England. The gang was caught red-handed in 2019 unloading pallets of cigarettes from a lorry into a farm unit in Essex.
UK: INDIVIDUALS DISQUALIFIED FOLLOWING CHARITIES COMMISSION INVESTIGATION INTO 8 CHARITIES AND THE LAUNDERING OF PROCEEDS FROM COUNTERFEIT MEDICATION
A news release from the Charity Commission on 16 March advised that 2 trustees had been removed and disqualified from their positions, and the manager of the charities involved was automatically disqualified, after he was convicted of laundering money through the charities from the sale of counterfeit medication, and supplying false information to the Commission. A number of the charities’ bank accounts are currently restrained by a court order under the Proceeds of Crime Act 2002. The charities involved were set up originally to advance the Orthodox Jewish faith and relieve poverty.
UK: COLLAPSED CARE HOME BOSS INVOLVED IN US SCAM
On 16 March, the BBC carried a report saying that a businessman connected to a collapsed care home had been involved in a property scam in the US a decade earlier, in which investors were sold useless and/or derelict properties in Detroit. A company called Carlauren attracted £76 million in investment in care homes before being placed in administration in November with £40 million unaccounted for. The man involved, Sean Murray, denies all wrongdoing.
UK: DATA PROTECTION STANDARDS AND WHETHER THEY WILL BE ADEQUATE TO ALLOW CONTINUED FREE FLOW OF DATA WITH THE EU
On 16 March, the Department for Digital, Culture, Media and Sport issued an news release saying that the UK is seeking adequacy decisions from the European Commission in order to maintain the continued free flow of personal data between the EU and UK (and Gibraltar). A framework document provides an overview of the UK’s comprehensive legal framework underpinning high data protection standards.
THE YUKOS CASE CONTINUES
On 13 March, RUSI published a Commentary about the continuing fallout from the Yukos affair. In the early 2000s, the company was forced into bankruptcy and its oligarch controller – who openly criticised Putin and began funding opposition parties – jailed. The article reminds one that, since then, Yukos’ shareholders have been embroiled in a 15-year legal battle against the Russian state. They claimed that the breakup of Yukos violated the Energy Charter Treaty that Russia signed in 1994, but Moscow never ratified. Recently, a court in the Hague upheld an arbitration award that Russia should pay $50 billion in compensation to former Yukos shareholders, having already won $2.6 billion in damages at the European Court of Human Rights (ECHR). Despite this, it is highly unlikely that Yukos shareholders will ever receive their compensation from the Russian state. Russia’s courts have now the power to ignore any international judgment, although Russia is a party to the Vienna Convention on the Law of Treaties.
GERMANY: NEW REGULATIONS WOULD ALLOW EXPANDED ONLINE GAMBLING
On 16 March, Calvin Ayre reported that the Bundestag had passed new regulations which, if approved by each state parliament and the Euopean Commission, would mean that online poker and casino-style games would become legal for the first time in the country. The target date is 1 July. Other games would also be permitted, including slot-type games, but these would be subject to strict rules over maximum stake and deposits required. There would also be changes to sports betting.
GANG RENTS BULLDOZERS IN GERMANY – THEN SELLS THEM ABROAD
On 16 March, OCCRP reported that an inventive gang has over the past few years developed a lucrative, illegal business: they rented bulldozers and similar machines from construction companies in Germany and sell them to construction companies in other EU countries.
UN EXPERTS CONDEMN THAI POULTRY PRODUCER FOR ALLEGED TARGETING OF HUMAN RIGHTS DEFENDERS WITH USE OF DEFAMATION LAWS
On 16 March, Jurist reported that Thammakaset allegedly used Thai defamation laws in 2019 to sue and have prosecuted 10 individuals who criticised Thammakaset’s labour practices for human rights abuses. A group of UN experts called for the country to reform its defamation laws, basing them on the UN Guiding Principles on Business and Human Rights to prevent companies from silencing human rights activists.
SPAIN AND PORTUGAL TAKE ILLEGAL IVORY OFF THE BLACK MARKET
A news release from Europol on 16 March announced that the Spanish Civil Guard and the Portuguese Civil Guard have broken up a criminal network trafficking ivory online, with the seizure of 355 ivory figurines and 2 tusks and 8 arrests. The ivory was sold online and at auction. The news release says that, although other trade routes exist, ivory is mainly sourced from Africa and is sent through Europe towards its final destinations in Asia.
GERMANY LOST €100 MILLION TO ILLEGAL CIGARETTES IN 2019
On 16 March, TJI reported that the figure for losses due to smuggled cigarettes was slightly down on that for 2018. It also said that Customs seized around 60 million illegal cigarettes last year – again slightly down on 2018. 48,316 kg of shisha tobacco was also seized, and 15,702 kg of leaf tobacco – this much higher than in 2018.
HONG KONG CUSTOMS OFFICIALS ARREST 4 PERSONS FOR SELLING MASKS WITH DANGEROUS BACTERIAL COUNT
On 14 March, the South China Morning Post reported that Hong Kong’s customs officials have arrested 4 pharmacy directors for selling masks that exceeded the limit of bacterial count by up to about 12 times. The face coverings could be particularly dangerous for the elderly and children and those with a weak immune system, authorities said. 2 brands came from Turkey and Nepal, while the source of 2 other brands were still under investigation.
BRITONS HAVE LOST £1 BILLION TO BANK TRANSFER FRAUDSTERS IN JUST 3 YEARS, RESEARCH SHOWS
On 16 March, the Daily Mail reported that consumer group Which? said banks are failing thousands of victims who have been tricked into transferring cash, often by criminal gangs posing as banks, police or even the taxman. A security measure called confirmation of payee (CoP), which checks the name of the payee matches the identity listed for the account, is due to be introduced by 31 March – but only the 6 biggest banking groups have been told to sign up to the voluntary scheme by this date.
UK: CITY FIRM REBUKED BY REGULATOR OVER AML TRAINING FAILURES
On 16 March, the Law Society Gazette reported that Withers LLP has been rebuked by the Solicitors Regulation Authority after failing to adequately train staff in AML measures. The SRA said just two-thirds of relevant employees had been trained by the end of 2018, with training of the remaining one-third completed by early October 2019. No financial penalty was imposed.
PARAGUAY LICENSES PRODUCTION OF CANNABIS FOR MEDICAL PURPOSES
On 16 March, Insight Crime reported that Paraguay issued its first-ever medical cannabis licences in February, with 12 pharmaceutical businesses receiving licences to import seeds for the domestic cultivation and sale of cannabis products with medical benefits, which eligible patients will be able to obtain for free. It is already claimed that Paraguay is the top producer of illegal marijuana in the region, with between 5,000 and 8,000 hectares cultivated in the country.
UK: THEFT OF EXPENSIVE MODEL RAILWAY SETS LINKED TO ORGANISED CRIME
Coventry Live on 16 March reported that a raid on a model railway group could be linked to organised crime it is believed. Valuable stock was stolen by intruders when they broke into the model railway exhibition in Leamington Spa. It is claimed that the raid was almost certainly pre-planned and well executed by an organised crime group.
RONALDINHO INQUIRY HEATS UP OVER MONEY LAUNDERING CONCERNS
On 16 March, Reuters reported that an inquiry that led to the detention of former Brazil player Ronaldinho entered a new stage as prosecutors focus on what they believe is a money laundering scheme involving the businesswoman who invited him to Paraguay.
FBI CHARGE 24 PEOPLE, INCLUDING 13 NIGERIANS, IN $30 MILLION FRAUD INVESTIGATION
On 16 March, the Daily Post in Nigeria reported the FBI investigation, noting that 13 Nigerians were amongst the 24 involved. The scams involved included Business Email Compromise schemes, romance fraud scams, and retirement account scams, among others.
PODCAST: IS MONEY LAUNDERING IN ONLINE GAMING FLYING UNDER THE RADAR?
On 15 March, in the first episode of Financial Crime Matters Season 2, Anton Moiseienko and Kayla Izenman of RUSI talk to the presenter about their recent report on money laundering in the online gaming world (Fortnite, Clash of Clans and others). It discusses how third party marketplaces are being used to exchange game currency (bought with illegal funds) for fiat currency, how financial institutions can spot this activity, and what the regulatory response has been so far.
PODCAST: THE STATUS OF EU LAW DURING THE TRANSITION PERIOD AND BEYOND
On 11 March, Law Pod published a podcast containing presentations by a panel of speakers who discuss the complexities of EU law during the Brexit transition period and beyond, as part of an event hosted by the Constitutional and Administrative Bar Association. The panel features Lord Anderson of Ipswich, Professor Catherine Barnard, Professor of European Union law at Cambridge and Alison Pickup, Legal Director at the Public Law Project.
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