OTHER THINGS YOU MAY HAVE MISSED – JULY 1

Panama Covid-19 update – 913 new cases take us to 34,463; while 14 more fatalities take the total to date to 645.  Having said that, I estimated that the death-rate in Panama is still only around a tenth of that in the UK – and it could be that the rise in cases in the last couple of weeks is a sort of “second wave”, that the UK has yet to face. I also worked out, roughly, that the average number of new cases since 9 March has been 293 per day, with 6.8 fatalities per day since 9 April. The good news is that another 200 people were marked as “recovered” today. The Rt infection rate is said to have dropped slightly, and is around 1.42 – you’ll recall that it has to be less than 1 for infection rates to be declining.

1 July 2020

US FCC DESIGNATES HUAWEI, ZTE AS RISKS TO NATIONAL SECURITY

On 30 June, The Verge and others reported that the US Federal Communications Commission officially designated telecommunications companies Huawei and ZTE as threats to national security. As a result, telecommunications providers are barred from using government subsidy money through the $8.3 billion Universal Service Fund to purchase equipment from the companies for their networks.

https://www.theverge.com/2020/6/30/21308477/fcc-huawei-zte-ban-universal-service-fund-national-security-threat-risk

EUROPEAN COMMISSION RELAUNCHES ITS LIST OF COUNTRIES REGARDED AS HIGH RISK FOR MONEY LAUNDERING AND TERRORIST FINANCING

A Commentary from RUSI on 22 June examined the European Commission revision of its methodology for a list of third countries considered to be high-risk for money laundering and terrorist financing in May 2020.

https://rusi.org/commentary/european-commission-relaunches-its-list-countries-regarded-high-risk-money-laundering-and

US URGES EXTENSION OF UN IRAN ARMS EMBARGO DUE TO END IN OCTOBER

On 30 June, the Wall Street journal reported that US Secretary of State Mike Pompeo had called on the UN Security Council to extend a 5-year ban on conventional weapons trade with Iran that is set to expire in October.

https://www.wsj.com/articles/pompeo-urges-u-n-to-extend-iran-arms-embargo-11593531943

US GOVERNMENT CLOSES BRIBERY PROBES INTO USANA HEALTH

On 1 July, the Wall Street Journal reported that the SEC and DoJ have closed their investigations into Usana Health Sciences Inc operations in China, a multilevel marketer of nutritional and personal-care products, following its prompt disclosure of the matter, which involved the US-based company’s BabyCare operations in China, and due to its thorough investigation, cooperation and remediation.

https://www.wsj.com/articles/government-closes-bribery-probes-into-usana-health-11593538504

WEBINAR: UNEXPLAINED WEALTH ORDERS (UWO): A GAME-CHANGER OR A DISTRACTION?

This recorded webinar from RUSI and first broadcast on 4 June is available online. It addressed how well UWO in the UK match up to the challenges posed by the likes of complex holding structures and challenges of obtaining evidence from abroad? Are they attracting too much focus at the expense of other statutory powers in the fight against economic crime? What light can international experience cast on how best to implement the new powers?

https://rusi.org/event/unexplained-wealth-orders-game-changer-or-distraction

MALTA: RECENT AMENDMENTS TO THE COMPANIES ACT (REGISTER OF BENEFICIAL OWNERS) REGULATIONS

An article from BDO Malta on 30 June is concerned with the new regulations, which amend the provisions on beneficial ownership requirements introduced in January 2018.  The new regulations confirm that the Registrar of Companies shall have further powers to investigate the ultimate beneficial ownership of the companies that are to be or are registered in Malta and require Maltese companies to abide by new annual filing obligation confirming ultimate beneficial ownership of the relative company’s issued shares. Maltese companies which fail to abide by the obligations would be subject to a penalty of €5,000 and daily penalties of €100 per day until compliance. Notably, one of the powers in the new regulations is that the Registrar of Companies may restrict the setting up of a new companies if the directors being proposed to the Board already hold the position of directors in other Maltese companies that are failing to comply with the UBO obligations.

https://www.bdo.com.mt/en-gb/news/2020/recent-amendments-to-the-companies-act-(register-of-beneficial-owners)-regulations

FRENCH MINISTRY OF JUSTICE ISSUES ADDITIONAL GUIDANCE WHICH CONFIRMS THAT FRANCE WILL CONTINUE TO BE AN ACTIVE PLAYER IN ANTI-CORRUPTION ENFORCEMENT

On 29 June, an article from Dechert LLP is concerned with a Circular issued on 2 June by the Ministry of Justice which explains what companies must do to be offered a CJIP (a deferred prosecution agreement). The Circular reiterates some of the principles set out in the non-binding guidelines issued by the Parquet National Financier and the French Anti-Corruption Agency (AFA) on 27 June. Dechert says that the MoJ is sending a clear signal that France has and will continue to actively enforce the anti-bribery Sapin II law. It also says that PNF has successfully developed relationships with other enforcement authorities and acted in partnership with them.

https://info.dechert.com/10/14279/june-2020/french-ministry-of-justice-issues-additional-guidance-which-confirms-that-france-will-continue-to-be-an-active-player-in-anti-corruption-enforcement(1).asp?sid=67c4633f-6898-420c-a884-54dc04e64798

US: CHINESE NATIONAL SENTENCED TO MORE THAN 3 YEARS IN PRISON FOR HIS ROLE IN LARGE-SCALE BIRTH TOURISM AND IMMIGRATION FRAUD RING

A news release from Immigration & Customs Enforcement on 30 June advised that Chao “Edwin” Chen, 35, a Chinese national has been sentenced in absentia  to 37 months in federal prison for participating in a large-scale birth tourism scheme that engaged in visa fraud that allowed foreign nationals to come to the US and give birth so their children would receive US birth right citizenship. He had pleaded guilty in June 2016 to visa fraud, marriage fraud and filing a false tax return but, soon after pleading guilty, Chen fled to China and remains a fugitive.

https://www.ice.gov/news/releases/fugitive-chinese-national-sentenced-more-3-years-prison-his-role-large-scale-birth

UN GRANTS FINNISH CHURCH AID NORTH KOREA SANCTIONS EXEMPTION FOR HUMANITARIAN AID SUPPLIES

On 24 June, the UN announced a 6-month sanctions exemption which authorises it to import items within the scope of its humanitarian assistance project, which aims to enhance the food security of primary school-aged children.

https://www.un.org/securitycouncil/sites/www.un.org.securitycouncil/files/1718_finland_exemption_request_24jun20_e.pdf

SRI LANKA IMPORT CONTROLS EXTENDED INDEFINITELY

Economy Next on 1 July reported that Sri Lanka has indefinitely extended sweeping import controls and licensing regime that was introduced for 3 months from 22 May in the face of foreign exchange shortages.

https://economynext.com/sri-lanka-import-controls-extended-indefinitely-amid-money-printing-71597/

JERSEY’S NEW BENEFICIAL OWNERSHIP SCHEME EXPECTED BY END OF 2020

On 1 July, International Investment reported that a draft Bill establishing a new central register of beneficial owners, controllers and significant persons has been tabled by the government of Jersey and is likely to come into force by the end of 2020. The article says that the initial impact of the new law will most likely be minimal as Jersey already has a central register of beneficial owners and controllers of entities. However, the new legislation will centralise all of the mandatory disclosure of information in one place.

https://www.internationalinvestment.net/news/4017189/jersey-beneficial-ownership-scheme-expected-end-2020

DUTCH POLICE ARREST 9 IN INVESTIGATION INTO COCAINE SMUGGLING VIA VLISSINGEN

On 1 July, Dutch News reported that 9 people have been arrested in raids across 30 different locations in Zeeland as part of a major investigation into drug smuggling. Most of the raids, involving some 400 police officers, took place in and around Vlissingen port. Recently several major drugs seizures have been made at the port, often hidden in shipments of bananas or other fruit.
https://www.dutchnews.nl/news/2020/07/police-arrest-nine-in-investigation-into-cocaine-smuggling-via-vlissingen/

ITALY SEIZES 14 TONNES OF “JIHAD DRUG” (AMPHETAMINE) IN RECORD BUST

On 1 July, Xinhua reported that the drugs — in the form of 84 million pills with a street value of €1 billion – were stashed inside industrial paper cylinders in 3 containers in Salerno. It is claimed to be the largest single seizure of amphetamines at a global level. The pills were labelled “captagon” a controlled substance (fenetthylline) that has been produced in the Middle East since the 1990s. They are said to have been shipped from Syria.

http://www.xinhuanet.com/english/2020-07/01/c_139180873.htm

https://www.alkhaleejtoday.co/international/5013952/Italy-seizes-%E2%82%AC1-billion-drug-shipment-of-ISIS-made-amphetamines-from-Syria.html

MALTA: SATABANK LOSES ITS BANKING LICENCE

On 1 July, the Times of Malta reported that Satabank has had its banking license withdrawn by the European Central Bank. The ECB was acting on the basis of a recommendation made by the local regulator, the Malta FSA. All its accounts were effectively frozen in October 2018, in the wake of alleged money laundering breaches.

https://timesofmalta.com/articles/view/satabank-loses-its-banking-licence.802062

EU MARKET FOR MEDICAL CANNABIS STILL FAR FROM FULL BLOOM

On 1 July, an article from EurActiv a temporary shortage of Dutch hemp flowers intended for export to Germany has put the spotlight on a lack of diversified supply sources and uniform quality standards in the growing European market for medical cannabis. The article says that all the Dutch exports to Germany rests on the shoulders of a single business, Bedrocan, which manages production capacity at national level. The delay in the delivery originates from some additional testing the Dutch supplier needed to perform before releasing the batches for export. Such a temporary interruption in the supply chain exposed potential bottlenecks caused by a lack of diversification in the production of medical cannabis for the German market.

https://www.euractiv.com/section/health-consumers/news/eu-market-for-medical-cannabis-flowers-still-far-from-full-bloom/

OBJECTIVES FOR THE FATF DURING THE GERMAN PRESIDENCY 2020-2022

On 1 July, FATF issued a news release advising that during the German Plenary years, the FATF will prioritise work on –

  • Digital Transformation of AML/CFT;
  • Financing of ethnically or racially motivated terrorism;
  • Money laundering and migrant smuggling;
  • Environmental crime; and
  • Illicit arms trafficking

It also says that FATF will continue to deliver its core work of identifying risks, setting standards, evaluating, and holding countries to account for effective action.

http://www.fatf-gafi.org/media/fatf/documents/German-Presidency-Priorities.pdf

VAT FRAUD WITH SALE OF SUGAR AND COOKING OIL IN HUNGARY UNRAVELLED

On 1 July, a news release from Eurojust advised that in an operation in Hungary, Austria, the Czech Republic, Slovakia and Serbia, coordinated by Eurojust and supported by Europol, Hungarian authorities have arrested 2 leaders of an organised crime group responsible for massive VAT fraud with the sale of sugar and cooking oil imported from EU Member States.

http://eurojust.europa.eu/press/PressReleases/Pages/2020/2020-07-01.aspx

UK: SRA CLOSES HIGH NET WORTH CLIENT FIRM OVER DISHONESTY SUSPICION

On 27 June, the Law Society Gazette reported that a Berkshire law firm set up by a former City high-flyer has been shut down by the SRA over suspicions of dishonesty, effectively closing K Law Solicitors, based in Ascot, with immediate effect.

https://www.lawgazette.co.uk/practice/sra-closes-high-net-worth-client-firm-over-dishonesty-suspicion/5104805.article

SOUTH AFRICA: ‘RAMPANT COLLUSION’ AND FRAUD ALLEGED BETWEEN PRIVATE LAWYERS AND THE OFFICE OF STATE ATTORNEY

On 1 July, News 24 reported claims that “rampant collusion” and “mammoth fraud” between private legal practitioners and the Office of the State Attorney has allegedly been discovered in a Special Investigating Unit (SIU) investigation, and a criminal investigation into former Gauteng head of the Office of the State Attorney, Kgosi Lekabe, was continuing.

https://www.news24.com/news24/SouthAfrica/News/siu-finds-rampant-collusion-between-private-lawyers-and-the-office-of-state-attorney-20200701

BULGARIA: ANTI-CORRUPTION COMMISSION CLAIMS FOR £67 MILLION

On 1 July, Novinite reported that the Anti-Corruption Commission has filed claims for confiscation of illegally acquired property against Minyu Staykov and Stayko Staykov, who have been charged by the prosecutor’s office.  The assets involved s sums of money, company shares including in offshore companies registered in Panama as well as Greek and Czech companies, real estate including parts of forested areas, bank deposits and cars.

https://www.novinite.com/articles/205122/Bulgaria%3A+Anti-Corruption+Commission+with+Claims+for+BGN+140+Million+Against+Minyu+and+Stayko+Staykovi

NAMES AND LOCATIONS OF MALTA’S PROPOSED MEDICAL CANNABIS MANUFACTURERS WILL NOT BE PUBLISHED

On 1 July, Lovin malta reported that 5 companies have submitted proposals to Malta’s Medicine’s Authority to cultivate and grow cannabis for medical and research purposes. However, Malta’s government has declined to publish their names or where their facilities will be based on the island. It is said that, in September 2019, the government said that medical cannabis companies based in Malta would produce and export around €1 billion worth of products over the next three years, with around 900 new jobs predicted.

https://lovinmalta.com/news/names-and-locations-of-maltas-proposed-medical-cannabis-manufacturers-will-not-be-published-minister-insists

UK: FUGITIVE FRAUDSTER ZAHID KHAN FACES EXTRADITION FROM HIDEAWAY IN UAE

On 1 July, Birmingham Live reported that Zahid Khan is facing extradition to the UK after being tracked down to his hideaway in the UAE. He has spent 2 years on the run after being jailed in his absence for 10 years over a £500,000 number plate fraud where, with 2 brothers and a scam had targeted a UK lottery winner.

https://www.birminghammail.co.uk/news/midlands-news/found-fugitive-fraudster-zahid-khan-18522719

US COMMERCE DEPARTMENT ISSUES NEW EXPORT CONTROL GUIDANCE FOR COMPANIES DOING BUSINESS IN CHINA, RUSSIA AND VENEZUELA

On 1 July, an article from Faegre Drinker was concerned with guidance and FAQ about the new rules which came into effect on 29 June 29 — particularly as they apply to entities in China. The FAQ s also address the presumption of denial for license applications for military end-uses and end-users, as well as the new mandatory Electronic Export Information (EEI) filing requirements for controlled items destined to China, Russia and Venezuela.

https://www.jdsupra.com/legalnews/u-s-commerce-department-issues-new-40308/

https://www.wilmerhale.com/en/insights/client-alerts/20200701-new-commerce-department-faqs-require-due-diligence-by-exporters-to-assess-chinese-military-end-uses-and-users

12 ARRESTS IN BIG HIT AGAINST ‘NDRANGHETA MAFIA IN ITALY

On 1 July, a news release from Europol advised that over 200 officers from the Italian Carabinieri  in Piedmont and the Italian State Police arrested 12 alleged members of the Italian crime syndicate, ‘Ndrangheta. This coordinated and decisive action is the result of a long and complex investigation carried out by the Italian authorities with the support of Europol and law enforcement authorities from Croatia, France and Germany.

https://www.europol.europa.eu/newsroom/news/12-arrests-in-big-hit-against-%E2%80%98ndrangheta-mafia-in-italy

US CUSTOMS DETAINS CHINESE SHIPMENT OF SUSPECTED FORCED LABOUR PRODUCTS MADE WITH HUMAN HAIR

A news release from US Customs & Border Protection on 1 July advised that CBP officers at the Port of New York/Newark detained a shipment of products/accessories suspected to be made with human hair that originated in Xinjiang, China, indicating potential human right abuses of forced child labour and imprisonment. The products were part of shipment of almost 13 tons of hair products worth over $800,000 dollars.

https://www.cbp.gov/newsroom/national-media-release/cbp-detains-chinese-shipment-suspected-forced-labor-products-made

US CUSTOMS OFFICERS DISCOVER FIFTH CENTURY SASANIAN COINS

Another news release on 1 July from US CBP advised that officers assigned to the Champlain Port of Entry Cargo Facility discovered seven Sasanian coins being shipped into the US.  9 unrecognisable foreign coins were discovered upon further inspection of a package and, upon close inspection a specialist determined 2 coins were minted in Armenia and the remaining seven in Iran. Officers were later notified that 7 of the coins were from Iran, dated back to the 5th Century, during the Sasanian Empire.

https://www.cbp.gov/newsroom/local-media-release/cbp-officers-discover-fifth-century-sasanian-coins

UK TO ANNOUNCE FIRST AUTONOMOUS HUMAN RIGHTS SANCTIONS BEFORE 21 JULY

On 1 July, the European Sanctions Blog reported that the Foreign Secretary has announced that regulations will be laid before Parliament providing targeted sanctions for violations of human rights, and that the UK’s first autonomous designations will be announced before 21 July.

https://www.europeansanctions.com/2020/07/uk-to-impose-first-human-rights-sanctions-before-21-july-2020/

A PRIMER ON CANADIAN SANCTIONS LEGISLATION

On 29 June, Blake, Cassels & Graydon LLP published an article comprising a primer which provides an overview of key requirements under Canadian sanctions legislation as of 30 June.

https://www.blakes.com/Insights/Bulletins/2020/A-Primer-on-Canadian-Sanctions-Legislation

NIGERIA: MALABU OIL AND GAS LIMITED ARRAIGNED FOR MONEY LAUNDERING OVER ALLEGED INVOLVEMENT IN THE CONTROVERSIAL OPL 245 TRANSACTIONS

On 1 July, Ripples Nigeria reported that the Economic and Financial Crimes Commission (EFCC) on Wednesday arraigned Malabu Oil and Gas Limited at the Federal High Court in Abuja for money laundering over its alleged involvement in the controversial OPL 245 transactions.  It also arraigned a businessman, Aliyu Abubakar, and 6 other companies – A-Group Construction Company Limited, Rocky Top Resources Limited, Mega Tech Engineering Limited, Novel Properties and Development Company Limited, and Carlin International Nigeria Limited.

https://www.ripplesnigeria.com/opl-245-efcc-arraigns-malabu-oil-seven-others-for-alleged-money-laundering

US: BIPARTISAN PLAN FOR STUDY INTO VIRTUAL CURRENCY’S ROLE IN ILLICIT ONLINE ACTIVITY

On 1 July, Coindesk carried a report about a plan to introduce legislation that would direct the Government Accountability Office (GAO) to study virtual currency’s role in illicit online activity. 

https://www.coindesk.com/us-senators-float-bill-requiring-congressional-watchdog-study-cryptos-role-in-trafficking

US SEEKS TO RECOVER $96 MILLION TRACEABLE TO FUNDS ALLEGEDLY MISAPPROPRIATED FROM MALAYSIAN SOVEREIGN WEALTH FUND 1MDB

A news release from the DoJ on 1 July advised that the DoJ has announced the filing of civil forfeiture complaints seeking the forfeiture and recovery of approximately $96 million in assets allegedly associated with an international conspiracy to launder funds misappropriated from 1Malaysia Development Berhad (1MDB), a Malaysian sovereign wealth fund.  It says that, to date, the US has recovered or assisted Malaysia in recovering nearly $1.1 billion in assets associated with the 1MDB international money laundering and bribery scheme.  The assets involved in this latest action include luxury real estate in Paris, artwork by Claude Monet and Andy Warhol, and accounts maintained at financial institutions in Luxembourg and Switzerland.

https://www.justice.gov/opa/pr/us-seeks-recover-approximately-96-million-traceable-funds-allegedly-misappropriated-malaysian

https://www.reuters.com/article/us-usa-1mdb/u-s-seeks-warhol-monet-paintings-linked-to-1mdb-scandal-idUSKBN2427BE

AUSTRALIA: FEDERAL POLICE HAVE REPORTEDLY FROZEN MORE THAN 50 BANK ACCOUNTS AFTER CRIMINALS TARGETED JOBKEEPER WAGE SUBSIDIES AND OTHER COVID-19 RELIEF SCHEMES

In its 2 July edition, the Canberra Times reported that the government has established a serious financial crimes task force bringing together the Australian Federal Police, the tax office and home affairs. It notes that JobKeeper is the biggest single spend of any welfare programme. The AFP have said that it has restrained assets in relation to fraud against government COVID-19 programs and we will work with other agencies to continue to do so.

https://www.canberratimes.com.au/story/6815572/criminals-targeting-virus-support-schemes/

ARIZONA $2 MILLION SETTLEMENT WITH OPIOID EXECUTIVE

On 1 July, ABC 15 in Arizona reported that the former CEO of a pharmaceutical company, Michael Babich in a case involving Insys Therapeutics, accused of widespread fraud to push opioid prescriptions has agreed to a $2 million settlement with the Arizona Attorney General’s Office.

https://www.abc15.com/news/local-news/investigations/state-nets-2m-settlement-with-opioid-executive

KENYA’S MOST SIGNIFICANT CORRUPTION CASE SUCCESS SHOWS THERE’S STILL MUCH SCOPE FOR INTERNATIONAL COOPERATION

On 1 July, the Basel Institute on Governance published an article about success in one of the Kenya’s most significant corruption cases to date: the sentencing of John Waluke, an MP, and Grace Wakhungu, who is the mother of a former Environment Cabinet Secretary, in a maize procurement fraud worth nearly $3 million – at a time when Kenya’s food security is at risk due to extreme weather, locust swarms and covid-19.  It was explained that international cooperation in South Africa under the provisions of the UN Convention Against Corruption (UNCAC) was key to the successful conviction.

https://www.baselgovernance.org/news/kenyas-most-significant-corruption-case-success-shows-theres-still-much-scope-international

CANADIAN WOMAN SENTENCED FOR ILLEGALLY EXPORTING US INDUSTRIAL PIPELINE & OIL REFINEMENT EQUIPMENT FROM US TO IRAN

A US DoJ news release on 26 June advised that Angelica O. Preti, 45, of Ontario, had been sentenced to 18 months in prison for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally exporting gas turbine engine parts from the US to Iran. She had been the export operations manager at a Canadian forwarding and customs brokerage service provider that had significant business in the US. She helped facilitate the shipment of US-origin gas turbine engine parts and valve assemblies and connectors used for industrial pipelines in the gas and petrochemical (oil refinement) industry to Iran in deliberate violation of a US embargo and trade sanctions.

https://www.justice.gov/usao-sdoh/pr/canadian-woman-sentenced-prison-illegally-exporting-american-industrial-pipeline-oil

 

 

 

If you would like to say thanks by making a small contribution, in case I need to upgrade or replace my computers and other paraphernalia, I have a page at https://www.buymeacoffee.com/KoIvM842y

 

 

 

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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