Panama Covid-19 update – couldn’t help smiling that the 2 former Presidents who faced interrogation yesterday over alleged corruption have been told they cannot leave the country – when it is impossible to fly anyway, at least until 22 July, as all non-cargo, and non-humanitarian flights are banned…
Meanwhile, another 758 new cases (35,995 to date, of which 15,809 in the 20-39 age range and 11,375 in the 40-59 age range). While the number of new cases are down, the number of fatalities is at a new high of 31 (698 to date, giving a death-rate of 1.94% of infected, below the 4.79% world average). There are currently 18,352 active cases, though 500 more have recovered, with 146 in ICU and 823 in other wards and 705 in requisitioned hotels. Of the total cases, the vast majority are in the relatively lower-risk age ranges of 20-39 (15,809) and 40-59 (11,375). I also noted that the highest number of new cases appeared to be in poorer areas, though our own area added 14 new cases.
3 July 2020
5 CREW KIDNAPPED BY PIRATES FROM CARGO SHIP OFFSHORE BENIN
On 3 July, Seatrade Maritime News reported that 5 seafarers have been kidnapped by pirates from a Pacific International Lines (PIL) multipurpose vessel. 5 Chinese crew members, including the Master, had been taken and presumed kidnapped.
9 KIDNAPPED BY NIGERIAN PIRATES FROM OFFSHORE VESSEL
Another article from Seatrade Maritime News on 3 July reported that 9 personnel have been kidnapped by pirates from the BW Offshore floating production storage and offloading (FPSO) Sendje Berge off Nigeria.
LUXEMBOURG TIGHTENS SCREWS ON TRUSTS WITH EU RULES
On 3 July, KYC 360 reported that the Luxembourg parliament has voted for trusts to provide information on the person who set up the trust, the trustee, and the beneficiaries the assets really belong too.
COMPANY IN US INVESTIGATION ON DIRTY MONEY FROM VENEZUELAN POLITICIANS CHANNELLED $120 MILLION THROUGH MALTA-BASED PILATUS BANK
On 1 July, Malta Today reported that €120 million in financial transactions from the now-closed Portmann Capital Management, were funnelled through the private Malta-based Pilatus Bank. Portmann had channelled a total of €120 million in transactions, out of €520 million it handled in total, through Pilatus Bank. The firm was fined €370,000 by the FIAU over its scant due diligence on its politically exposed clients (PEP), and €63,000 by the Malta FSA.
EU TAKES AUSTRIA, BELGIUM, NETHERLANDS TO COURT OVER FAILURE TO IMPLEMENT AML RULES
On 2 July, Reuters reported that the European Commission said it was suing Austria, Belgium and the Netherlands because the countries had not fully integrated EU rules on AML into their national laws, i.e. for failing to fully implement the 4th AML Laundering Directive.
NEW EXPORT CONTROLS FOR SURVEILLANCE TECHNOLOGY IN EUROPE
A short (“coffee break”) podcast from Reed Smith on 24 June consists of partners from Reed Smith’s International Trade & National Security team discussing changes to the EU export controls on surveillance technology expected to enter into force soon. From their vantage points in London, Washington and Brussels, the lawyers address what these changes might mean to business, and how they might restrict the UK’s access to certain products following its imminent departure from the EU.
ANTI-BRIBERY AND CORRUPTION DURING COVID-19: KEY COMPLIANCE STEPS
An article from Travers Smith LLP on 25 June explores several new bribery and corruption challenges faced by organisations in light of COVID-19, and ways in which internal compliance policies and procedures should be updated to address such challenges. It proposes 5 best practice steps which should be considered to help redress the balance:
- Make sure new suppliers go through proper on-boarding channels;
- Communicate and re-highlight ABC policies, procedures training and other guidance to employees;
- Revisit your risk assessments;
- Re-start any ABC processes which may have been placed on pause; and
- Deal diligence and other forms of customer/ payment diligence should continue to be prioritised, but flexibility is key.
IRELAND: UNIT TRUST AND ICAV REGISTER OF BENEFICIAL OWNERSHIP
On 1 July, A&L Goodbody in Ireland published an article saying that the next step has been taken to establish a Central Register of Beneficial Ownership of Irish Collective Asset-management Vehicles (ICAV) and Unit Trusts. ICAV and Unit Trusts in existence before 25 June have until 25 December to file information on the central register. Unit Trusts authorised on or after 25 June and ICAV registered on or after 25 June will have a 6-month filing deadline.
EUROPEAN COURT OF HUMAN RIGHTS ASKED TO EXAMINE AN ORDER BY FRENCH HIGH COURT FOR THE RESTITUTION OF PAINTING LOOTED BY NAZIS
On 2 July, the Art Newspaper reported that a US collector will sue France in the European court arguing that the French judgement violates the ownership and defence rights of his client. The collector said he had purchased the work in good faith at Christie’s in 1995. but the High Court upheld the terms of a 1945 order annulling all acts of plunder that occurred under the German occupation.
TURKEY PUTS 4 PILOTS AND 3 OTHERS ON TRIAL FOR HELPING GHOSN FLEE JAPAN
The Japan Times on 3 July reported that a private airline official, 4 pilots and 2 flight attendants (who face a 1-year prison term each if convicted of not reporting a crime) have gone on trial in Istanbul, accused of smuggling former Nissan Motor Chairman Carlos Ghosn out of Japan to Lebanon, via Turkey. Turkish airline company MNG Jet said in January that 2 of its aircraft were used illegally in Ghosn’s escape, first flying him from Osaka to Istanbul, and then to Beirut.
VATICAN FIU ANNUAL REPORT
On 3 July, the Catholic News Agency reported on the release of the 2019 annual report by the Autorità di Informazione Finanziaria, or AIF. It is said that it received 64 SAR in 2019, 15 of which it forwarded to the Promoter of Justice for possible prosecution. The release of the report comes ahead of a scheduled inspection by Moneyval, the Council of Europe’s AML watchdog. However, the Catholic Culture website comments that the president of the AIF does not mention the October police raid on the AIF offices, nor the abrupt departure of the agency’s top 2 officials.
ESTONIA HIRES US LAW FIRM TO INVESTIGATE MONEY LAUNDERING
On 3 July, ERR in Estonia reported that the Ministry of Finance has entered into an agreement with the USlaw firm Freeh Sporkin & Sullivan LLP to provide legal services to the Estonian state in international money laundering investigations.
US: WELL-KNOWN RARE COIN BUSINESS AND $200 MILLION SILVER TRADING SCAM
On 2 July, KSL.com reported that Denise Gunderson Rust, 60, a member of a Utah family that ran a well-known rare coin business accused of running a $200 million silver trading scam has pleaded guilty to money laundering in federal court. The scam has been described as one of largest and most financially destructive frauds Utah has ever seen with nearly 700 victims. Federal prosecutors say the company, Rust Rare Coin Inc, defrauded at least 700 investors nationwide of at least $200 million. Members of the Rust family are accused of tricking people into believing they were pooling their money to buy and sell silver bullion, but the funds were allegedly used to pay other investors.
IRELAND: SUPREME COURT CLEARS BERNIE MADOFF PONZI LOSS CASE FOR HEARING
On 3 July, the Irish times reported that the Court has cleared the way for a full hearing of a claim concerning multimillion losses related to the Ponzi scheme run by jailed US fraudster Bernie Madoff. A BVI-registered investment fund had sued HSBC Institutional Trust Services (Ireland) Ltd for €141 million but the case will proceed against HSBC France on foot of a consent order made in May. The fund alleges negligence and breach of contract regarding the HSBC company’s alleged role as a custodian of funds.
US: BUSINESSES ADVISED TO INTENSIFY EFFORTS TO IDENTIFY FORCED LABOUR IN CHINA SUPPLY CHAINS
On 3 July, Sandler Travis Rosenberg reported that US businesses, investors, and others with potential exposure in their supply chains to China’s Xinjiang Uighur Autonomous Region or facilities outside Xinjiang that use labour or goods from Xinjiang are being warned of the economic, legal, and reputational risks of being involved with entities that engage in human rights abuses, including forced labour in the manufacture of goods intended for international distribution. This is contained in a joint advisory from the Departments of Homeland Security, Commerce and State, and the US Treasury.
GIBRALTAR: 10% IMPORT DUTY ON PERSONAL IMPORTS
On 3 July, the Government of Gibraltar published a news release clarifying exemptions to the 10% import duty to be levied on personal imports and aimed to encourage the ‘BUY LOCAL’ campaign.
FORMER US JUDGE PLEADS GUILTY TO OBSTRUCTING DRUG TRAFFICKING PROBE
On 3 July, OCCRP reported that Ryan Kamada, a former judge from Colorado’s 19th Judicial District, has pleaded guilty to obstructing a federal task force’s large-scale drug trafficking investigation. The judge had warned a personal friend who was acquainted with a known drug trafficker and this person passed on the warning to the drug trafficker, disrupting the investigation. The judge then deleted evidence of his conversation with his friend and in November pleaded guilty to destruction of records with the intent to obstruct a federal investigation.
COUNTERFEIT CURRENCIES WORTH MILLIONS OF EUROS PREVENTED FROM ENTERING THE EU ECONOMY IN ROMANIA AND SPAIN
On 3 July, a news release from Europol advised that 2 separate operations dismantled 2 illegal print shops for counterfeit currencies: one for high quality Romanian lei and one for euros.
THE ROLE OF DRUG ANALYSIS LABORATORIES IN EARLY WARNING SYSTEMS
A publication from the UN Office on Drugs & Crime says that drug analysis laboratories are key to a functioning national, regional or international early warning system due to the specific expertise, information and data they can generate. This publication focuses on information available from the laboratories analysing drug seizures and/or responsible for toxicological analysis. It aims to provide drug analysis laboratories and other stakeholders with practical information and examples on how to participate in an early warning system. The main functions of drug analysis laboratories in early warning systems are to –
- Detect and identify new and known substances, as well as combinations of these, which pose a potential threat;
- Cooperate in improving analytical characterisation of NPS and other drugs;
- Systematise and validate the information collected in the system;
- Provide drug analysis data and intelligence information (when relevant) for the preparation of reports and products to different recipients;
- Support national, regional and international data collection Identify adulterants; and
- Determine purity
46 lb OF CHEMICALS USED TO CREATE ILLEGAL DRUGS SEIZED BY US CUSTOMS
A news release from US Customs & Border Protection on 2 July advised that officers had intercepted a shipment originating from China containing 46.5 lb of chemicals that are often referred to as ‘club drugs’ or ‘date rape drugs’. 2 bottles were found to contain 23.5 lb of Gamma-Butyrolactone (GBL), a DEA List I precursor chemical and 22.9 lb of 1,4-Butanediol, a precursor chemical for Gamma-Hydroxybutyric Acid (GHB).
US-BELIZE MEMORANDUM OF COOPERATION FOR COLLABORATION ON CARGO INFORMATION-SHARING PROGRAMME
On 2 July, Breaking Belize News reported that thе Веlіzе Сuѕtоmѕ аnd Ехсіѕе Dераrtmеnt аnd US Сuѕtоmѕ аnd Воrdеr Рrоtесtіоn (СВР) have ѕіgnеd а Меmоrаndum оf Соореrаtіоn thаt рrоvіdеѕ fоr соllаbоrаtіоn оn аnd іmрlеmеntаtіоn оf аn іnfоrmаtіоn-ѕhаrіng рrоgrаm utіlіsіng саrgо mаnіfеѕt аnd соnvеуаnсе іnfоrmаtіоn.
MEXICO OIL THIEVES GO UNDERGROUND TO AVOID DETECTION
On 3 July, Insight Crime reported that oil thieves in Mexico are sidestepping security forces by utilising hoses buried just out of sight underground to transport stolen fuel, with at least 5 underground hoses in 4 states.
UK GUIDANCE ON DAC 6 CROSS-BORDER TAX REPORTING PUBLISHED
On 2 July, Out-Law published an article saying that HMRC has published guidance on how it will apply the EU Directive known as DAC 6, designed to enable EU tax authorities to share information about cross-border tax schemes. The legislation applies from 1 July.
THE EU TAXONOMY REGULATION
This article from Eversheds Sutherland on 3 July says that a key element of recent EU measures designed to encourage environmentally sustainable investment decision making is the Taxonomy Regulation – EU Regulation 2020/852/EU. The article explains that it is a technical framework that helps to assess how sustainable (or, in crude terms, how ‘green’) an economic activity is on a scientific, comparable basis. This in turn allows for the assessment of a particular company or portfolio. The article looks at the aims and uses of the Regulation. It also considers the impact on the UK post-Brexit. The article also explains that the transparency reporting requirements that flow from the Regulation take effect from 2022 and 2023, with the first company reports and investor disclosures due at the beginning of 2022.
FCA DECISION NOTICE RE CONOR FOLEY, FORMER CEO OF WORLDSPREADS, FINING HIM £658,900 FOR MARKET ABUSE AND BANNING HIM FROM PERFORMING ANY ROLES LINKED TO REGULATED ACTIVITY
A release on Mondo Visione on 3 July advised that the Decision Notice has been referred to the Upper Tribunal where Foley and the FCA will each present their cases. Foley is the third and last executive of WSL against whom the FCA has taken action following its collapse in March 2012.
SUDANESE HUMAN SMUGGLING NETWORKS: FUELING INSTABILITY FROM NORTH AFRICA TO EUROPE
On 29 June, the International Centre for Counter-Terrorism in The Hague published an article describing Sudan as a country located at the crossroads of conflict, poverty, and criminality. It says that Sudan is the primary transit destination for irregular migrants from the Horn of Africa seeking to reach Europe via North Africa and the Central Mediterranean and feeding a booming irregular migrant trade that is now the cornerstone of a wider illicit industry estimated to be worth at least €6 billion a year.
UN REPORT ON IRAN ARMS EMBARGO
On 11 June, the UN Secretary General submitted to the Security Council the 9th report on implementation of the UN arms embargo on Iran under UN SCR 2231. In the report, proliferation of missile technology throughout the Middle East, including with non-State actors, is raised as a point of concern.
EU: 2019 e-CUSTOMS ANNUAL PROGRESS REPORT
On 22 June, the EU published the 12th and latest annual report about progress on its e-Customs project. EU Council Decision 70/2008/EC4 on a paperless environment for customs and trade, also referred to as the e-Customs Decision, is the key legislation related to the e-Customs initiative promoting a shift to an interoperable electronic customs environment with a unified data system to facilitate communication between economic operators and customs authorities and to enhance security at EU’s external borders. The project, initiated by the European Commission, aims to replace paper-format customs procedures with EU-wide electronic procedures to create a more efficient and modern customs environment. The project has 2 broad objectives – enhancing security at the EU’s external borders, and facilitating trade.
The EU-wide Union Customs Code (UCC), and associated legislation, is largely built around electronic, non-paper-based, systems. While the UCC provides a single EU framework for customs rules and procedures, the development and upgrade of IT systems required for the completion of customs formalities are a joint responsibility of the Member States and the EU Commission. The report considers the developments during 2019 in various aspects in and surrounding the e-Customs project. It concludes that during the course of 2019, the EU Commission achieved several fundamental milestones related to the successful implementation of the ongoing e-Customs reform. The transition to a paperless environment is a priority for the Member States and the EU Commission, a commitment reflected in the completion of several legislative, business, IT, and operational activities in the e-Customs domain.
MOLDOVA: THE POWERS OF THE STATE TAX SERVICE WILL BE EXPANDED TO PREVENT AND COMBAT ECONOMIC CRIMES
On 3 July, InfoMarket reported that it is planned that for this the State Tax Service will be given the authority to conduct a criminal investigation in accordance with the Law on Special Investigation Activities. It refers to a range of tax crimes to be countered, including “pseudo-entrepreneurial activity”, tax evasion, excise duty evasion, the illegal production of state excise stamps, intentional or fictitious bankruptcy and falsification of accounting documents.
SRI LANKA: CENTRAL BANK (CB) DISMISSES CONCERNS OVER POTENTIAL MONEY LAUNDERING ACTIVITIES LINKED TO THE RECENTLY INTRODUCED SPECIAL DEPOSIT ACCOUNTS (SDA)
In its 4 July edition, the Daily Mirror in Sri Lanka also reported that the government had said that rules relaxing certain foreign exchange controls to encourage foreign currency remittances into the country across foreign currency deposit accounts, would be revised to address the concerns over money laundering and terrorist financing.
DEMAND FOR RAW MATERIALS FOR ELECTRIC CAR BATTERIES SET TO RISE FURTHER
On 25 June, the UN Conference on Trade and Development reported that the demand for raw materials used to manufacture rechargeable batteries will grow rapidly as the importance of oil as a source of energy recedes, as highlighted recently by the collapse of prices due to oversupply and weak demand resulting from COVID-19. A new report documents the growing importance of electric mobility and the main materials used to make rechargeable car batteries. It reminds one that reserves of the raw materials for car batteries are highly concentrated in a few countries. Nearly 50% of world cobalt reserves are in the DRC, 58% of lithium reserves are in Chile, 80% of natural graphite reserves are in China, Brazil and Turkey, while 75% of manganese reserves are in Australia, Brazil, South Africa and Ukraine. The highly concentrated production, susceptible to disruption by political instability and adverse environmental impacts, raises concerns about the security of the supply of the raw materials to battery manufacturers. The report warns that supply disruptions may lead to tighter markets, higher prices and increased costs of car batteries, affecting the global transition to low-carbon electric mobility. The report shines a light on the social and environmental impacts of the extraction of raw materials for car batteries and underlines the urgent need to address them, such as child labour in DRC mining and in Chile, lithium mining uses nearly 65% of the water in the country’s Salar de Atamaca region, one of the driest desert areas in the world.
The report itself is at –
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