Panama Covid-19 update – “only” 2 more fatalities today, taking us here to 281 today, with 141 new cases reported, edging us closer to the 10,000 mark at 9,867. 70 people are in ICU.
19 May 2020
US CHARGES IRANIAN COMPANY AND EXECUTIVES WITH SANCTIONS VIOLATIONS
On 19 May, the Wall Street Journal reported that Payment24 allegedly helped Iranian citizens circumvent US sanctions to make purchases from US-based companies 2009-2018. Seyed Sajjad Shahidian, Vahid Vali and the company, Payment24 have been charged with conspiracy to commit offences against the US, money laundering, identity theft and wire fraud. Mr Shahidian was arrested in and extradited from the UK. Services said to have been offered included a “package” consisting of a PayPal account, a fraudulent ID card, a remote IP address from the UAE, a Visa gift card, and tailored advice.
LOS ANGELES-AREA REAL ESTATE AGENT PLEADS GUILTY TO COORDINATING MULTI-MILLION-DOLLAR SCHEME THAT FUNDED MARIJUANA GROW HOUSES
A news release from US Immigration and Customs Enforcement on 18 May advised that Lin Li, aka Aaron Li, 38, a real estate agent pleaded guilty to a federal criminal charge for coordinating a scheme that used millions of dollars to purchase nine residential homes in San Bernardino County that were then converted into illegal marijuana grow houses. Between May 2013 and September 2017, Li facilitated the purchase by Chinese investors of 9 residential homes in Chino, Chino Hills and Ontario. While exercising control over these properties, Li converted or allowed the conversion of the houses to marijuana grow operations.
COMMON LAW ON THE HORIZON FOR HUNGARY?
An article from SMARTLEGAL Schmidt & Partners for the International Law Office on 19 May reflects on a new Act, which entered into force on 1 April and fundamentally reforms the role of judge-made law in Hungary. The article examines why this landmark Bill was passed, the extent to which it means the adoption of common law and what its potential impact will be on litigation in Hungary. The Act marks a milestone in the development of Hungarian law (which belongs to the Romano-Germanic legal family), since it is a shift from the above principle according to which law is made by the legislature, towards common law, where the existence of judge-made law is widely accepted.
UK GOVERNMENT ISSUES GUIDANCE ON SHARING INFORMATION WITHIN CORPORATE GROUPS FOR AML PURPOSES
On 12 May, MacFarlanes published an article saying that the UK had issued a publication that provides guidance to international corporate groups on sharing information across borders to assist in AML/CFT efforts – a reminder from the UK government that it considers information-sharing to be crucial to effectively combatting financial crime and that FATF has previously published guidance on the practice, which it approves.
US THREATENS SPANISH OIL COMPANY REPSOL WITH SANCTIONS OVER VENEZUELA
On 19 May, Olive Press reported that Repsol, Eni from Italy and India’s reliance have been told to suspend operations in Venezuela.
TAIWAN TELLS US IT IS COMPLYING WITH NORTH KOREA SANCTIONS
On 19 May, Al Jazeera reported that, despite reports of involvement in ship-to-ship transfers, a senior Taiwanese security official told the US deputy representative for North Korea that the country was complying with sanctions, despite not being a member state of the UN.
SUCCESSFUL FUEL MARKING PROGRAMME AN ECONOMIC LIFELINE FOR MOZAMBIQUE
On 19 May, the African Exponent reported that the current contract for the fuel marking scheme expires in a few months, but it seems highly likely that it will choose to continue the programme. It says that fuel smuggling and adulteration, however, have long been major issues draining Mozambique’s revenues and enriching criminal gangs. It says that the illicit oil trade is a problem across Africa, costing the continent nearly $100 billion a year — but the so-called Maputo Corridor, comprising South Africa, Swaziland, and Mozambique, had emerged as a regional hotspot for and a pilot study in 2013-14 suggested that Mozambique was losing as much as $60 million a year. However, fuel marking has resulted in an impressive uptick in tax revenues from fuel sales. The article also says that the fuel marking programme has also provided Mozambican authorities with valuable insights into how organised crimes groups carry out fuel fraud.
IRAN: IRANIAN COUPLE HAS BEEN SENTENCED TO DEATH FOR HAVING SMUGGLED HARD CURRENCY AND LAUNDERING $200 MILLION OF MONEY,
Daily Sabah on 19 May reported that Vahid Behzadi and his wife Najva Lasheidai, both in their early 40s and whose case had not previously been given a high profile, have reportedly been sentenced to death for having smuggled hard currency and laundering $200 million of money, as well as having been found with a stash of gold at their home.
MOROCCAN SMUGGLERS EMBARK ON LONG NEW ROUTE TO SHIP DRUGS TO EUROPE
Defence Web on 19 May reported that, with usual routes closed off due to the covid-19 crisis, Moroccan drug traffickers are making a circuitous journey involving food trucks and fishing boats to smuggle locally grown cannabis to market – with food trucks across Morocco and then fishing vessels sailing from Atlantic ports.
LATVIA: 8 MILLION ILLEGAL CIGARETTES SEIZED AT RIGA FREEPORT
On 19 May, Xinhua reported that Latvian customs officers have seized a haul of around 8 million illegal cigarettes while checking a container cargo at the Freeport of Riga.
AUTHORITIES SEIZE 850,000 POOR QUALITY MASKS AT ATHENS AIRPORT
On 19 May, Ekathimerini reported that Greece’s Financial Crimes Squad (SDOE) has confiscated 850,000 poor quality face masks did not meet the necessary specifications and lacked international markings at Athens’ International Airport. The seized shipment had been ordered by Greek import companies and were destined for the domestic market.
NEURAL NETWORK MODEL TO ASSIST CUSTOMS TO DETECT POTENTIAL FRAUDULENT TRANSACTIONS
A news release from WCO on 19 May announced that, as part of the WCO BACUDA (Band of Customs Data Analysts) project with the Institute of Basic Science (IBS) and the National Cheng Kung University (NCKU), WCO has developed a Dual-Attentive-Tree-aware-Embedded (DATE) neural network model to assist Customs administration to better detect transactions presenting risks of fraud. The WCO BACUDA project was launched in September 2019 as a collaborative research platform focused on data analytics.
IS NIGERIA TURNING AROUND ITS ANTI-CORRUPTION ENFORCEMENT?
On 19 May, a post in the FCPA Blog posed this question, saying that Nigeria’s anti-corruption law enforcement efforts are gradually growing more effective as practitioners adapt and innovate in response to many persistent challenges. It reflects on research conducted by a University of Edinburgh-led team and some of its preliminary findings.
UKRAINIAN OLIGARCH IS BEING INVESTIGATED BY A US GRAND JURY
On 19 May, Buzz Feed reported that Igor Kolomoisky is accused of funnelling money from a Ukrainian bank into properties across the US. The co-founder of PrivatBank is accused by Ukraine regulators of orchestrating a scheme to siphon money from the country’s largest bank and funnel it into prime properties, including landmark office towers and steel facilities across the US.
SHIPPING GROUP PROMOTES STANDARDISED E-BILL OF LADING
On 19 May, American Shipper reported that 9 carriers in the Digital Container Shipping Association say eliminating paper from transactions will improve all aspects of the process, and that the COVID-19 pandemic has made the need for a standardized industry e-bill of lading (eBL) greater than ever.
ONLY SMALL AMOUNTS CONTINUE TO BE FROZEN UNDER UK TERRORISM SANCTIONS
On 19 May, HM Treasury released the latest set of quarterly statistics on the operation of counter-terrorism sanctions to 31 December. These show that only £9,000 was frozen under Terrorist Asset-Freezing Etc Act 2010 powers, £18,000 under EU counter-terrorism sanctions and £31,000 under UN ISIL/Al-Qaida sanctions.
US COMMERCE DEPARTMENT EXPORT CONTROLS TARGETING HUAWEI AGAIN
On 19 May, Wilmer Hale provided details of the effects of further changes to export controls affecting Huawei which came into operation on 15 May. It explains changes to the Direct Product Rule, a Rule which restricts exports and reexports of some foreign-produced items that are the direct products of certain controlled US-origin technology, software, a complete plant or any major component of a plant. The amendment applied the Rule to a broader class of foreign-produced items when there is knowledge that the foreign-produced item will be exported, reexported or transferred (in-country) to an entity on the Department’s Entity List – which includes Huawei and affiliates.
CAN DHS SURVIVE TRUMP ERA?
On 18 May, The Crime Report carried an article saying that a bipartisan thinktank in the US has claimed that the Department of Homeland Security needs to free itself from political meddling and radically overhaul its infrastructure, or it will succumb to growing calls for its abolition.
UK SANCTIONS: KEY LESSONS LEARNED AS OFSI BEGINS TO FLEX ITS MUSCLES
On 19 May, Crowell Moring published an article reflecting on the role of the UK Office of Financial Sanctions Implementation in the light of recent actions, including the record £20 million fine for Standard Chartered. The article says that there are a number of key takeaways from the case of relevance to companies seeking to understand how OFSI will implement its relatively new power to impose civil penalties. It comments on these, and draws comparisons between the OFSI approach and the approach taken by the US and OFAC, including the fact that the penalty reduction for a voluntary disclosure could have been higher in the US, but the total penalty could have been higher.
IRAN, NORTH KOREA, SYRIA, VENEZUELA AND CUBA CERTIFIED UNDER US ARMS EXPORT CONTROL ACT AS NOT COOPERATING ON COUNTER-TERRORISM EFFORTS
On 13 May, Homeland Security Today reported that this was the first year that Cuba has been certified by the US State Department as not fully cooperating since 2015. The consequence of the move is that it prohibits the sale or licensing for export of defence articles and services and notifies the US public and international community that these countries are not fully cooperating with US counter-terrorism efforts. Re Cuba it is noted that members of the ELN, who travelled to Havana to conduct peace talks with the Colombian government in 2017, remained in Cuba in 2019 and Cuba refused Colombia’s request to extradite 10 ELN leaders living in Havana after the group claimed responsibility for bombing in January 2019.
NATIONAL DIGITAL CURRENCIES: THE FUTURE OF MONEY?
On 19 May, the Belfer Center in the US said that its Economic Diplomacy Initiative, in collaboration with the Atlantic Council’s Global Business and Economics Program, is tracking the latest developments in central bank issued digital currencies. It says that while many are in the early stages of research, central banks representing one-fifth of the world’s population say they are likely to issue a digital currency very soon.
US CHARGES TEXAS MAN WITH $5 MILLION-PLUS CORONAVIRUS LOAN FRAUD
On 19 May, Reuters reported that US federal prosecutors have charged Samuel Yates, 32, from Texas, with fraudulently seeking $5 million in loans from an emergency program established to ease the economic strain caused by the coronavirus pandemic. Yates claimed to employ over 400 people, although in reality “no employees worked for his purported business,” prosecutors said in a statement.
US: JOINT PROBE LED TO THE SEIZURE OF $22 MILLION WORTH OF CRYPTOCURRENCY FROM DARKNET OPERATORS
On 19 May, Coin Telegraph reported that FinCEN has made its annual award whereby it recognizes law enforcement agencies for using Bank Secrecy Act reporting to successfully pursue and prosecute criminal investigations to a joint operation involving US Immigration and Customs Enforcement-Homeland Security Investigations, the US Postal Inspection Service, and US Secret Service. This was in relation to a case where the agencies made 42 arrests, with the seizure of $22 million in various digital currencies, $3.5 million in cash, 120 firearms, 15 pill press machines, and a wide range of controlled substances.
UK: MAN ARRESTED IN BELFAST OVER ALLEGED COVID-19 LOAN FRAUD
On 19 May, the Belfast telegraph reported that a 38-year-old man has been arrested after allegedly attempting to fraudulently apply for a government Covid-19 support loan.
PAYMENT PROCESSING COMPANY AND ITS FORMER EXECUTIVE $40.2 MILLION SETTLEMENT RE CHARGES THEY KNOWINGLY PROCESSED PAYMENTS AND LAUNDERED, OR ASSISTED LAUNDERING OF, CREDIT CARD TRANSACTIONS FOR SCAMS THAT TARGETED HUNDREDS OF THOUSANDS OF CONSUMERS
A release on Mondo Visione on 19 May advised that Atlanta-based First Data Merchant Services LLC, one of the leading payment processing companies, and its former executive Chi “Vincent” Ko will pay more than $40.2 million to settle Federal Trade Commission charges they knowingly processed payments and laundered, or assisted laundering of, credit card transactions for scams that targeted hundreds of thousands of consumers. It is said that the company repeatedly looked the other way while its payment processing services were being used to commit fraud. According to the FTC complaint, Ko, through his prior company, First Pay Solutions LLC, opened hundreds of merchant accounts for at least 4 scams.
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