Panama Covid-19 update – the loudest, heaviest rain I’ve heard yet today, with more thunder, and it’s not the rainy season yet. Meanwhile, 120 new cases (9,726 total, edging us towards the 10,000 mark) and 4 more fatalities, taking the total to 279.
18 May 2020
AUSTRALIA: ACCUSED MONEY LAUNDERER LINKED TO $10 MILLION FUNDING FOR AN STOCK EXCHANGE-LISTED COMPANY AIMING TO PRODUCE HAND CLEANSER
On 18 May, KYC 360 reported that a bankrupt underworld figure accused of cleaning money for drug kingpin Tony Mokbel is understood to have raised $10 million in funding for an ASX-listed company Skin Elements.
GERMANY: BaFin ORDERS NOTICE ON ALL IRAN AND NORTH KOREA BUSINESS
Bird & Bird reported that the German Federal Financial Supervisory Authority (BaFin) issued a requirement for written notice, with effect from 14 May, of all business and transactions conducted in connection with Iran or North Korea. The requirement affects all “obliged entities” covered by the country’s AML law and all insurance businesses supervised by BaFin.
THE IMPACT OF THE MALIAN CRISIS ON THE GROUP OF FIVE SAHEL COUNTRIES
The Stockholm International Peace Research Institute on 18 May published a paper saying that the so-called ‘Malian crisis’ has now become a regionally multidimensional crisis. Economic, social, political and human dimensions are fed by structural and continuing dissatisfaction of marginalized and vulnerable populations. The fall of Muammar Gaddafi’s regime in Libya (2011) and the subsequent destabilisation of Mali (2012) have had protracted consequences throughout the Sahel region which was already affected by structural factors of fragility such as climatic, economic and development challenges. This is the third paper from SIPRI on the situation and it analyses regional and national policy responses that—with limited success so far and to the detriment of development policy—aim to address key security challenges, as part of the “spillover” effects of the Malian crisis in the neighbouring states that make up the Group of Five Sahel (G5 Sahel) countries—Burkina Faso, Chad, Mauritania and Niger.
UK: CHANGES TO AUTHORISED ECONOMIC OPERATOR (AEO) APPLICATIONS
On 18 May, HMRC advised in Customs Information Paper 6/2020 that applications must be submitted using the EU Customs Trader Portal from 1 June. This will not change the way HMRC checks your application or visits your business before it approves your application. You need to ask HMRC for access to the portal (which can take up to 5 days).
https://www.gov.uk/guidance/changes-to-authorised-economic-operator-applications-cip-6
EU SUED FOR FUNDING ‘FORCED LABOUR’ ERITREA HIGHWAY
On 13 May, EU Observer reported that a Dutch NGO is suing the EU for financing road work projects in Eritrea, a country where forced labour is used, amid calls by Green MEPs to suspend the funding. Some €80 million of EU trust funds have been channelled into equipment and materials to renovate a highway.
https://euobserver.com/foreign/148353
PORTUGAL SUSPENDS FOREIGN WASTE IMPORTS
On 18 May, EurActiv reported that Portugal, which attracts huge mounds of rubbish from other European states because of its low waste management fees, has suspended imports of trash until the end of 2020 to protect domestic landfill capacity. The country has already blocked 246,000 tonnes of trash from entering since the start of the year and no new imports will be accepted.
DENMARK ADOPTS NEW DIVIDEND TAX MODEL AFTER MULTIPLE FRAUD CASES
On 18 May, BNN Bloomberg reported that Denmark is adopting broad changes to how foreign investors are refunded dividend taxes in the wake of the “Cum-Ex” tax scandal across Europe. Denmark has filed cases against almost 500 firms and individuals across 5 countries for allegedly claiming refunds to which they weren’t entitled and has so far settled with 61 US pension funds to claw back about $233 million.
MORE THAN 300 CHANNEL ISLAND RESIDENTS HAVE HANDED OVER PREVIOUSLY UNPAID TAXES TO HMRC AMID A CRACKDOWN
Bailiwick Express in Guernsey on 18 May reported that 867 individuals living as “tax exiles” admitted previously failing to pay tax in 2018-19 compared to just 66 the previous year and, of these, 40% were residents of the Channel Islands, Around 1 in 10 were from Isle of Man residents, while 6% were from residents of Switzerland.
REPORT REVIEWING THE EVIDENCE BASE ON UK CROSS-BORDER DIGITAL TRADE AND POTENTIAL IMPROVEMENTS TO DATA SOURCES
On 14 May, the UK Department for Digital, Culture, Media and Sport published a news release which said that, despite the growing importance of cross-border digital trade, little is known about its nature and scale. The report identifies possible sources of data on digital trade and compiles relevant statistics for the UK, and data gaps and proposes ways to fill them.
https://www.gov.uk/government/publications/understanding-and-measuring-cross-border-digital-trade
RWANDA GENOCIDE SUSPECT ARRESTED IN FRANCE WITH INTERPOL SUPPORT
A news release from Interpol on 16 May advised that Félicien Kabuga, indicted by the International Criminal Tribunal for Rwanda (ICTR), a man wanted in connection with the 1994 Rwandan genocide, and subject of an INTERPOL Red Notice, has been arrested by French police. A Red Notice for the now 84-year-old was issued by INTERPOL in 2001 at the request of the ICTR.
TUNISIA GOVERNMENT RELAUNCHES WAR ON CORRUPTION
On 15 May, Asharq-Al Awsat reported that the Tunisian government has decided to refer 21 high-ranking customs employees to compulsory retirement for suspected graft. Government sources confirmed that the decisions fall in line with the anti-corruption campaign launched by Tunisian Prime Minister Youssef Chahed in 2017.
https://english.aawsat.com/home/article/2285206/tunisia-government-relaunches-war-corruption
ONLY THOSE CUSTOMS-AUTHORISED TO BE ABLE TO IMPORT TOBACCO PRODUCTS INTO NEW ZEALAND
On 15 May, Devdiscourse reported that the New Zealand Government will close a loophole that allowed some people to import cigarettes and loose-leaf tobacco for manufacturing cigarettes and ‘roll your owns’ without excise tax being paid. The legislation, which does not affect duty-free allowances for travellers, has been passed by Parliament.
GERMAN CUSTOMS SEIZED RECORD AMOUNT OF NON-EU DRUGS IN 2019
On 15 May, Xinhua reported that the German customs authority said it had seized “record quantities” of drugs originating in non-EU countries in 2019, with cocaine seizures at German ports increased to 10 tonnes.
http://www.xinhuanet.com/english/2020-05/15/c_139060376.htm
UK-FLAGGED TANKER REPULSES PIRATE ATTACK IN GULF OF ADEN
On 18 May, Hellenic Shipping News reported that armed pirates attacked a British-flagged chemical tanker in the Gulf of Aden but were repulsed. The pirates approached the Stolt Apal in 2 speedboats some 75 nautical miles off Yemen.
PIRACY IS ON THE RISE, AND CORONAVIRUS COULD MAKE IT WORSE
On 18 May, Hellenic Shipping News reported that in 2019, there were fewer attacks and attempted attacks on ships than there had been in 25 years. However, the first 3 months of 2020 have seen a 24% increase in pirate attacks and attempted attacks, over the same period in 2019. The author of the article reports that the coronavirus pandemic may make piracy even more of a problem in the coming months and years.
https://www.hellenicshippingnews.com/piracy-is-on-the-rise-and-coronavirus-could-make-it-worse/
US: “MASSIVE FRAUD” AGAINST STATE UNEMPLOYMENT INSURANCE PROGRAMMES
The Krebs on Security blog on 18 May reported that a well-organized Nigerian crime ring is exploiting the COVID-19 crisis by committing large-scale fraud against multiple state unemployment insurance programmes, with potential losses in the hundreds of millions of dollar – filing unemployment claims in different states using Social Security numbers and other personally identifiable information (PII) belonging to identity theft victims. The post refers to a US Secret Service memo on the matter.
THE US HAS A CHANCE TO TARGET DEMAND-SIDE BRIBERY
A post on the FCPA Blog on 18 May says that while companies are prosecuted aggressively (in certain countries, like the US and UK at least) the misconduct by government officials typically escapes notice, or at least prosecution. However, it says that the US Congress has a chance to establish one by adopting the Countering Russian and Other Overseas Kleptocracy Act (aka CROOK Act – you have to admit that the US comes up with good abbreviations…).
MALAYSIA: MONEY LAUNDERING AND TAX EVASION CASE OF FORMER PM’S WIFE VACATED TO GIVE WAY TO AN ONGOING CORRUPTION CASE
The trial of the wife of former Malaysian PM Najib Razak, Datin Seri Rosmah Mansor, for money laundering and tax evasion , which was set for this month has been vacated to make way for her ongoing corruption trial involving the solar hybrid project for rural schools in Sarawak. The judge, who is presiding both cases, said he is giving priority to the ongoing solar hybrid case before proceeding with the money laundering case.
https://www.bernama.com/en/general/news.php?id=1842701
UKRAINE UPDATES ITS RUSSIA SANCTIONS
On 18 May, EU Sanctions Blog reported that Ukraine has amended its Russia sanctions regime with effect from 14 May. 235 entities in total are currently subject to sanctions (233 having been delisted). 377 people (down from 848 in 2019) are subject to an asset freeze, travel ban, and a prohibition on participating in the privatisation of Ukrainian assets. A new decree also renews the ban for 3 years on Russian ISP such as Mail.ru and Yandex, and Russian social media sites.
https://www.europeansanctions.com/2020/05/ukraine-updates-its-russia-sanctions-list/
US: TSA TO ‘MAXIMIZE INNOVATION AND TECHNOLOGY’ TO COUNTER INSIDER THREATS TO TRANSPORTATION
On 15 May, Homeland Security Today reported that the US Transportation Security Administration (TSA) has released a framework to thwart insider threats in the transportation sector. The Roadmap is intended to “streamline processes, identify requirements and capabilities, and leverage partnerships to proactively mitigate risks” associated with insider threats. It says that TSA began conducting counter insider threat activities early in its existence and established a formal program in 2013. It has consistently identified insider threat among its enterprise-level risks.
CRIMINALS SET UP STALL ON UK GOVERNMENT IT MARKETPLACE TO PEDDLE EMAIL FRAUD SERVICES TARGETING ‘GULLIBLE’ PUNTERS
The Register on 18 May reported that the Cabinet Office has confirmed that scammers and/or jokers broke into the UK government’s Digital Marketplace to promote a round-the-clock “bespoke” fraudulent email service that preys on “gullible consumers”, at £10,000 a time, from “Fraud Consulting Ltd”.
https://www.theregister.co.uk/2020/05/18/uk_g_cloud_fraud_as_a_service/
FOLLOW THE FBI’S SWEEPING LA CITY HALL CORRUPTION INVESTIGATION THROUGH THE YEARS
On 18 May, Laist.com published an article saying that it has attempted to assemble the full scope of the FBI investigation into Los Angeles city hall using piecemeal documents and snippets of information that have been released so far. To help keep track of what it knows, it put together a timeline combining important dates and milestones, starting in 2016.
DEMOCRATIC REPUBLIC OF CONGO WILL NOT RENEW A CONTRACT WITH BELGIAN MANUFACTURER SEMLEX TO MAKE ITS PASSPORTS
The Daily Maverick in South Africa reported on 18 May that prosecutors have been investigating allegations of money laundering and corruption by Semlex, which makes biometric passports for DRC under a contract agreed under former President Joseph Kabila that expires on 11 June. It says that, at $185, Congo’s passport is among the world’s most expensive, even though its people are on average among the poorest.
LEBANESE CENTRAL BANK OFFICIAL CHARGED IN CURRENCY PROBE
On 18 May, AP reported that a Lebanese prosecutor has charged a senior central bank official – Mazen Hamdan, the head of cash operations at the bank – with manipulation of the exchange rate and money laundering as part of an ongoing probe amid the country’s financial turmoil. He is the most senior official to be named in an ongoing probe into possible financial wrongdoing against the backdrop of a deepening liquidity crunch, negative economic growth, soaring inflation and a massive state debt.
https://apnews.com/5dd4cdddf278e7259ee848fa61002657
17 COUNTRIES FAIL TO IMPLEMENT EU FIFTH AML DIRECTIVE
On 18 May, STEP reported that the EU Commission has now launched enforcement action against more than half of the EU’s Member States for failing to fully transpose the 5AMLD into their national law by the 10 January. The UK and 8 Member States – Austria, Belgium, the Czech Republic, Estonia, Greece, Ireland, Luxembourg and Poland – received letters of formal notice.
https://www.step.org/news/seventeen-countries-fail-implement-eu-5amld
THE ESTONIAN COMPANY FORMATION AGENT, A KIEV CALL CENTRE SCAM, CARIBBEAN SHELL COMPANIES AND POOR SWEDES
On 18 May, OCCRP provided further information linked to the alleged call centre scam for defrauding people across the world by convincing them they were making investments in stocks, bitcoins, and foreign currencies through legitimate financial firms. The scheme is currently under investigation in Sweden. All 61 Estonian companies found to be linked to the so-called Milton Group were set up by the same Estonian company formation agent – who denies involvement in any crime. The agent offers off-the-shelf firms for prices starting at €600, and virtual office services, including a contact person and mail forwarding, for an additional €500 a year. 25 of the companies in the Estonia-St. Vincent network have Swedish directors or owners, most of them hail from Stockholm or small towns nearby and several are related to each other. However, these Swedes are unlikely company directors, and at least one claims that his identity must have been hijacked.
https://www.occrp.org/en/fraud-factory/fraud-factory-firms-traced-to-penniless-proxies
MOLDOVA ACCUSES TYCOON OF INVOLVEMENT IN $1 BILLION FRAUD
On 18 May, Reuters reported that Moldova’s Prosecutor General said that one of the country’s richest people, Vladimir Plahotniuc, had been charged with involvement in the theft of $1 billion from Moldovan banks in 2014-2015 – which saw the equivalent of an eighth of the republic’s GDP stolen from 3 of its largest banks. Moldova has already jailed former prime minister Vlad Filat and businessman Veaceslav Platon in connection with the scandal, in which money was for year siphoned overseas through dubious loans, asset swaps and shareholder deals.
HONG KONG SFC FINES FIRM OVER $110 MILLION THIRD-PARTY DEPOSITS WITH NO REVIEW OF SOURCE OF FUNDS
On 18 May, Finance Magnates reported that the Securities and Futures Commission has fined Southwest Securities (HK) HK$5 million for failing to meet AML/CFT laws. It is said that the listed brokerage firm violated the rules in 2016, as it did not conduct relevant CDD and handled third-party deposits without auditing the names of the originators.
https://www.rferl.org/a/russia-pakistan-among-biggest-spenders-on-nuclear-weapons/30618712.html
US: CIVIL ACTION FILED TO FORFEIT RARE CUNEIFORM TABLET FROM HOBBY LOBBY
On 18 May, a news release from Immigration and Customs Enforcement advised that a civil complaint has been filed to forfeit a rare cuneiform tablet bearing a portion of the epic of Gilgamesh, a Sumerian epic poem considered one the world’s oldest works of literature. Known as the Gilgamesh Dream Tablet, it originated in modern-day Iraq and entered the US contrary to federal law. The tablet was later sold by an international auction house to Hobby Lobby Stores Inc, a prominent arts-and-crafts retailer based in Oklahoma City, for display at the Museum of the Bible.
https://www.ice.gov/news/releases/civil-action-filed-forfeit-rare-cuneiform-tablet-hobby-lobby
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