Panama Covid-19 update – reported new cases down to “only” 753 today (total to date now 55,906) with 21 more fatalities (taking that total to 1,180) – with an apparent death-rate of 2.1%. 158 people remain in ICU and 1,155 in other hospital wards.
22 July 2020
AUSTRALIA: WIFE OF DRUG KINGPIN ARRESTED WITH BANKRUPT CONSTRUCTION LABOUR HIRE KINGPIN GEORGE ALEX
On 21 July, the Sydney Morning Herald reported that construction industry identity George Alex, his son Arthur and the wife of jailed drug kingpin Michael Ibrahim are allegedly among members of a major crime syndicate who have been arrested over their involvement in tax fraud and money laundering. George Alex, 49, who was arrested with his son Arthur, 22, has been an undischarged bankrupt since 2011 – notwithstanding a corruption inquiry in 2015 being told that Alex controlled a number of labour-hire companies which were paying money to the Construction, Forestry, Maritime, Mining and Energy Union for favourable construction deals. Michael Ibrahim is currently serving a 30-year sentence for conspiring to import more than 1.7 tonnes of MDMA, 136 kg of cocaine and 15 kg of methylamphetamine.
EIGHTH DEFERRED PROSECUTION AGREEMENT APPROVED IN THE UK
On 20 July, an article from Ropes & Gray LLP said that another DPA has been approved, concluding an investigation commenced by the SFO in 2013. It says that the settlement with G4S Care & Justice (UK) Ltd provides some further clarity on the SFO’s approach to when DPA will be agreed and the terms to which it will expect co-operating corporate organisations (and their parent entities) to commit.
THE LLC IS COMING TO JERSEY
On 17 July, an article from Cadwalader Wickersham & Taft LLP says that the introduction of the limited liability company (LLC) under Jersey law is designed with the US market in mind and is seen as a means to enable Jersey to continue to grow the amount of in-bound business from North America. A Jersey LLC should be treated in the same way as any other non-US LLC, and we expect the Jersey LLC to become an increasingly prevalent part of the fund (and therefore fund finance) landscape. The article lists the characteristics of an LLC, saying that an LLC provides a very flexible structure, and LLCs can differ from one to the next.
https://www.cadwalader.com/fund-finance-friday/index.php?eid=705&nid=94
DNA TECHNOLOGY FIGHTS FISH FRAUD
On 16 July, an article from HKTDC in Hong Kong says that mislabelled seafood threatens consumers and the environment – a Hong Kong start-up offers a rapid species identifier to combat the problem.
TOBACCO BLACK MARKET SYNDICATES EXPLOITING WEAK MALAYSIAN BORDERS
On 22 July, the Straits Times reported that organised criminal syndicates are taking advantage of Malaysia’s weak border security to smuggle illicit tobacco into the country as well as ‘re-exporting’ these contraband products to other countries in the region, including Australia. This is according to the Retail and Trade Brands Advocacy (RTBA), an international non-government organisation that aims to safeguard supply chains and brands from criminal conduct. The article says that a report in April, Illicit Tobacco in the Asia Pacific Region: Causes and Solutions, indicated that Malaysia’s borders are vulnerable to criminal exploitation as key smuggling routes for illicit tobacco inflows and outflows. The report also cited that transshipment remains a serious concern for the movement of illicit tobacco through Malaysia, both domestically and regionally.
The RTBA report is at –
https://rtbacommerce.com/assets/reports/illicit-tobacco-in-the-asia-pacific-region.pdf
ILLEGAL DRUGS WORTH US$70 MILLION SEIZED AT HONG KONG AIRPORT CARGO TERMINAL IN 6 MONTHS AS CORONAVIRUS PANDEMIC FORCES SMUGGLERS TO CHANGE TACTICS
On 22 July, the South China Morning Post reported that 1.47 tonnes of illegal drugs were found in air cargo packages mailed into and out of the city in the first 6 months of the year – as coronavirus travel restrictions forced international syndicates to use alternative smuggling methods, customs said. It is said that there has been a dramatic surge in the detection of illegal drugs from express parcels mailed into Hong Kong in recent months. Nearly 80% of the 206 kg of cocaine came from Europe and Africa, while Europe also accounted for 85% of the 118 kg of ketamine. Of the 152 kg of crystal meth, 70% came from SE Asian countries while 87% of the 122 kg of cannabis was mailed from North America.
SINGAPORE: MAS FINES TRUST FIRM FOR MONEY LAUNDERING BREACHES
On 22 July, Singapore Business Review reported that the Monetary Authority of Singapore (MAS) has imposed a $1.1 million penalty on trust firm Asiaciti Trust for failure to comply with AML requirements between 2007 and 2018. The failings are said to have hindered the trust’s ability to detect and mitigate money laundering risks associated with its higher-risk customers. Established in 1978, the family-owned and independent Asiaciti Trust is said to be an international trust and corporate services provider that has operated here since 1980.
https://sbr.com.sg/financial-services/news/mas-fines-trust-firm-money-laundering-breaches
TRANSACTION LAUNDERING: FAKE BUSINESSES ARE FOOLING REAL BANKS INTO PROCESSING ONLINE DRUG PURCHASES
On 22 July, the Wall Street Journal carried an article about “companies” being used as fronts to process payments for marijuana or designer drugs. It reports that the US DoJ and Federal Trade Commission (FTC) have recently brought a string of criminal and civil cases accusing individuals and companies of using legitimate-looking websites to deceive financial firms into processing unsavoury purchases. Such schemes are often called credit-card laundering or transaction laundering.
HIGH-PROFILE NEW ZEALAND BUSINESSMAN ARRESTED IN AUSTRALIA OVER MONEY LAUNDERING INVESTIGATION
On 22 July, the Technology 19 website reported that a high-profile New Zealand businessman has been caught up in multimillion-dollar tax fraud and money laundering allegations in Australia, with Mark Bryers being one of 12 people arrested by Australia’s Federal Police. TVNZ reports that Bryers is banned from operating a company in New Zealand until 2022.
SEIZED FLORIDA HOME OF ALLEGED FRONTMAN FOR DRUG LAUNDERER SELLS FOR $12 MILLION
On 21 July, The Real Deal website reported that, 4 years after its seizure, a white palatial estate in Coral Gables bought in 2015 and owned by Samark Jose Lopez Bello has been sold. Lopez Bello is a high-profile fugitive and is the alleged frontman for Tareck Zaidan El Aissami, a former vice-president of Venezuela and alleged drug trafficker.
PODCAST: PRIMER ON MONEY LAUNDERING: JOHN MADINGER
In the latest TRACE podcast, a 22-year veteran of Treasury and consultant to the US DoJ, John Madinger, sheds light on some of the money laundering schemes he has uncovered and why the Breaking Bad car wash scheme probably wouldn’t have worked.
https://traceinternational.org/resources-podcast
THE NEW GLOBAL HUMAN RIGHTS SANCTIONS REGIME IN THE UK – COMPARISON
A blog post from UK Finance on 14 July considers the new “Magnitsky” human rights-based sanctions regime recently introduced in the UK, and includes the following comparison –
https://www.ukfinance.org.uk/news-and-insight/blogs/global-human-rights-sanction-regime-in-UK
LATEST FIRE ON AIR CARGO FLIGHT PROMPTS NEW QUESTIONS ON LITHIUM BATTERY SAFETY
On 22 July, Loadtsra reported that a fire onboard an Ethiopian Airlines 777 freighter at Shanghai Pudong has again triggered questions on the safety of lithium batteries and cargo misdeclaration. A source is said to have said that there were 3 pallets of lithium batteries listed on the manifest, for loading in China for export. Lithium ion and lithium metal batteries are prohibited on passenger aircraft, and there are strict rules on their carriage on freighters – but there have been problems with undeclared counterfeit batteries, poor packaging and misdeclared batteries.
https://theloadstar.com/latest-freighter-fire-prompts-new-questions-on-lithium-battery-safety/
EU: 320 TONNES OF POTENTIALLY DANGEROUS DAIRY PRODUCTS TAKEN OFF THE MARKET
On 22 July, a news release from the EUIPO was about Operation Opson IX, coordinated by Europol and INTERPOL, which targeted trafficking of counterfeit and substandard food and beverages, ran from December 2019 to June 2020 and involved law enforcement authorities from 83 countries. It led to the dismantling of 19 organised crime groups involved in food fraud and the arrests of 406 suspects. Seizures included 320 tonnes of smuggled or substandard dairy products in Bulgaria, Italy, France, Greece, Portugal and Switzerland. However, animal feed was the most seized product, followed by alcoholic beverages (more than 2 000 tonnes), cereals, grains and derived products, coffee and tea and condiments.
https://euipo.europa.eu/ohimportal/en/web/guest/news/-/action/view/5896264
https://www.interpol.int/News-and-Events/News/2020/Food-fraud-in-times-of-COVID-19
2025 UK BORDER STRATEGY PUBLIC CONSULTATION
On 22 July, the cabinet Office and others launched a consultation document which seeks the views and expertise of stakeholders to help develop the 2025 UK Border Strategy and ensure that the Government and industry are able to work in partnership together to deliver a world class border. The consultation closes on 28 August. It is not seeking views from individual commercial or leisure travellers who move across the border, but welcomes responses from groups representing them. It is not seeking views on the Border Operating Model or arrangements for the border at the end of the transition period, but is rather focussed on the long-term ambition for the UK’s border.
https://www.gov.uk/government/consultations/2025-uk-border-strategy-public-consultation
LARGE-SCALE TAX FRAUD IN ITALY DISMANTLED WITH EUROJUST SUPPORT
A news release from Eurojust on 17 July advised that Eurojust supported the Italian national authorities in cracking down on an organised crime group involved in large-scale tax fraud concerning diesel fuel and other financial crimes. The organised crime group, headed by Italian nationals and mainly composed of Italian citizens, was suspected of introducing and selling diesel fuel in Italy, evading the payment of production, excise tax and VAT. The fuel was transported in oil tankers from Germany via Austria to the North of Italy, entering the country with documentation falsely attesting to the merchandise as lubricant oil.
http://www.eurojust.europa.eu/press/PressReleases/Pages/2020/2020-07-17.aspx
UK ANTI-CORRUPTION STRATEGY: YEAR 2 UPDATE
On 22 July, a news release from the Home Office highlights the action taken since the launch of the UK anti-corruption strategy 2017 to 2022 and covers the period up to and including 31 December 2019. Highlights claimed by the report include –
- securing long-term funding for the Anti-Corruption Strategy for prisons and probation and the extensive work in the defence sector, for example on getting access to the right kind of data and analysis to help tackle the threat posed by corrupt insiders;
- using Unexplained Wealth Orders and Account Freezing Orders, to highlight and seize property and bank accounts from people suspected to have obtained them corruptly while;
- for the first time, the new Office of Financial Sanctions Implementation (OFSI) has punished companies for breaching sanctions;
- publishing an Asset Recovery Action Plan including how to recover and return assets stolen through corruption;
- reviewing the arrangements with Overseas Territories and Crown Dependencies which allow respective tax and law enforcement authorities to quickly, safely and securely receive information on who ultimately owns the companies they are investigating (known as beneficial ownership);
- using expertise to help other countries to transform their public procurement services; and
- using the Prosperity Fund on a global programme to help countries combat corruption.
NEW UK BUSINESS SUPPORT MEASURES: CORPORATE INSOLVENCY AND GOVERNANCE ACT 2020
On 22 July, the House of Commons Library published a briefing paper which provides an outline of the main measures of the new Corporate Insolvency and Governance Act 2020. The Act introduces permanent measures to update the UK insolvency regime, and temporary measures to give struggling businesses a lifeline during the current coronavirus crisis.
http://researchbriefings.files.parliament.uk/documents/CBP-8971/CBP-8971.pdf
US STATE DEPARTMENT OFFERS REWARDS FOR ARREST/CONVICTION OF 2 UKRAINIANS
2 news releases from the US State Department on 22 July said that the Department was offering a reward of $1 million each for information leading to the arrest and/or conviction of Oleksandr Vitalyevich Ieremenko or Artem Viacheslavovich Radchenko for participating in transnational organised crime. It is said that Artem Viacheslavovich Radchenko and Oleksandr Vitalyevich Ieremenko and other hackers in Ukraine undertook criminal efforts to enrich themselves through a sophisticated securities fraud scheme.
https://www.state.gov/artem-viacheslavovich-radchenko
https://www.state.gov/oleksandr-vitalyevich-ieremenko
CONVICTED MONEY LAUNDERER PLEADS GUILTY TO DEFRAUDING BANK WHILE HE WAS SERVING TERM OF SUPERVISED RELEASE
A news release from the US DoJ on 21 July advised that Deallto McQuil Key Davis, 25, of Maryland, had pleaded guilty to conspiring to defraud Wells Fargo Bank out of hundreds of thousands of dollars. In 2015, Davis was convicted of conspiracy to commit money laundering in federal court in Virginia. He was sentenced to 6 months in prison and 3 years of supervised release for that offence. The new offences were carried out whilst on that supervised release.
COINSQUARE EXECUTIVES RESIGN AFTER “WASH TRADING” SCANDAL
On 22 July, INVEZZ reported that Coinsquare, a Canada-based crypto exchange has agreed to settle with Ontario Securities Commission (OSC) following a “wash trading” scandal. It is reported that the exchange’s senior executives instructed employees to make fake trades on the platform and, from July 2018 to December 2019, where 90% of its volume was fake. Cole Diamond, Coinsquare’s CEO, Virgile Rostand, the exchange’s founder, have resigned per the agreement – as well as paying penalties and costs. The OSC also banned Diamond and Rostand from becoming registrants, directors, or officers of a registrant for 3 years. The agency also prohibited them from acting as directors or officers of other market participants for 3 years and 2 years respectively. Felix Mazer, the exchange’s chief compliance officer, is said to have knowingly authorised, permitted, and acquiesced the activity. He stepped down from his position and made a £39,400 voluntary payment to the OSC and has been made subject to a 1-year ban from acting as a director or officer of a registrant, and is prohibited from holding a position the requires registration.
https://invezz.com/news/2020/07/22/coinsquares-executives-resign-following-wash-trading-scandal/
INDIA: FORMER DELOITTE CEO BANNED FOR 7 YEARS FROM AUDITING AND FINED
On 22 July, Business Today reported that Udayan Sen is the former CEO of Deloitte India and the action is a result of his role in the audit of scam-hit IL&FS Financial Services (IFIN).
MANY MYANMAR MINING BUSINESSES FAIL TO NAME POLITICALLY CONNECTED OWNERS
On 22 July, The Irrawaddy website said that A Global Watch report claims that at least 10 companies in Myanmar have failed to identify “politically exposed persons” (PEP) —those with links to high-ranking present or former military officials and ethnic armed groups — among their owners. The NGO based its findings on an analysis of the first batch of beneficial ownership information disclosures submitted by companies in the country’s troubled extractives sector. It is said that, in Myanmar, a lack of transparency in the extraction of natural resources in resource-rich ethnic regions helps perpetuate and finance violent conflict in these areas.
ESTONIAN MINISTRY OF JUSTICE IS PREPARING TO DEVELOP A BILL TO PROTECT WHISTLEBLOWERS
On 22 July, ERR reported that, by the end of 2021, Estonia must transpose the EU Directive on the Protection of Whistleblowers into law. When the law enters into force, it will be prohibited to use coercive measures against the whistleblower in the future, such as harassment, reduction of wages, or dismissal or threats.
https://news.err.ee/1115523/state-developing-bill-to-protect-whistleblowers
THE MAYOR OF ZIMBABWE’S CAPITAL HARARE ARRESTED OVER CORRUPTION CHARGES
On 22 July, the Tukish-based Anadolu Agency reported that Herbert Gomba had been taken into custody by the Anti-Corruption Commission. He is allegedly facing charges of criminal abuse of office in connection with a massive land scam that has led to the arrest of several public officials over recent weeks, including city council officials, police officers, and a prosecutor.
https://www.aa.com.tr/en/africa/zimbabwe-capitals-mayor-arrested-in-corruption-probe/1918750
UK ECONOMIC CRIME LEVY TO COLLECT £100 MILLION A YEAR
On 22 July, the Law Society Gazette published an article about the consultation underway on the Levy, saying that the Government had “slipped out” proposals to collect £100 million a year from business to fight economic crime, as parliament winds down for the summer.
https://www.lawgazette.co.uk/news/economic-crime-levy-to-collect-100m-a-year/5105114.article
LEGAL PROFESSION ‘VIGILANT’ AGAINST MONEY LAUNDERING, SAYS LAW SOCIETY OF ENGLAND & WALES
An article in the Law Society Gazette on 22 July reported that solicitors are ‘all too aware’ of the threat of money laundering, the Law Society has said in response to the just-released report into Russian influence in the UK. The report warns that lawyers are part of an ‘industry of enablers’ which has helped ‘wittingly or unwittingly, in the extension of Russian influence which is often linked to promoting the nefarious interests of the Russian state’.
On the other hand –
LAWYERS HAVE BECOME “DE FACTO AGENTS OF RUSSIAN STATE”
On 22 July, an article in Legal Futures says that lawyers have become “de facto agents of the Russian state” by helping to smooth the way of Russian money entering the UK, according to Parliament’s Intelligence and Security Committee in its just-released report. The report also said that lawyers, accountants, estate agents and PR professionals have played a role, wittingly or unwittingly, in the extension of Russian influence which is often linked to promoting the nefarious interests of the Russian state.
https://www.legalfutures.co.uk/latest-news/lawyers-have-become-de-facto-agents-of-russian-state
GERMAN PROSECUTORS NOW SUSPECT ORGANISED CRIMINAL ENTERPRISE AT WIRECARD
On 22 July, Reuters reported that the CEO of Wirecard had been rearrested, along with other former top executives, as prosecutors say that they now suspect them of an organised criminal enterprise to bilk creditors of billions of euros based on faked accounts.
10 LEGAL CONSIDERATIONS WHEN STARTING A HEMP BUSINESS IN THE US
On 22 July, an article from Bradley Arant Boult Cummings LLP provides the 10 things the firm thinks you should consider when starting a hemp business.
https://www.jdsupra.com/legalnews/ten-legal-considerations-when-starting-97670/
UK: AVOIDANCE SCHEMES – CHARTERED INSTITUTE OF TAXATION WELCOMES ROBUST APPROACH ON PROMOTERS
A news release from CIOT on 21 July commented on the publication of draft legislation and a consultation document on tackling promoters and enablers of tax avoidance schemes. It says that the UK Government is right to be taking a robust approach to those who continue to devise, promote or sell tax avoidance schemes. There should be no place for such people and their schemes in the tax services market.
ESTONIA PUBLISHES ITS LIST OF WHO IT REGARDS AS PEP
On 20 July, ERR reported that the Ministry of Finance has provided guidance for compliance officers on what government positions the Government of Estonia considers to be Politically Exposed Persons (PEP).
MIDDLE EAST AND NORTH AFRICAN AUTHORITIES SEIZE FAKE MEDICAL PRODUCTS
On 22 July, OCCRP reported that an operation across the Middle East and North Africa, coordinated by Interpol, seized thousands of counterfeit medical masks and drugs. Between February and April, authorities from Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Qatar and Saudi Arabia carried out inspections on their land, water and air borders, targeting pharmaceutical crimes. Seizures included 61,000 respiratory masks, 63,418 face masks and 85,000 other medical products such as gloves, thermometers, medical glasses, in addition to a variety of illicit medicine ranging from antimalarial drugs to sexual stimulants.
END OF THE ROAD FOR KEYLESS CAR THIEVES IN GERMANY AND POLAND
On 22 July, a news release from Europol says that German and Polish law enforcement authorities, supported by Europol, have dismantled a network of thieves stealing expensive cars equipped with KEYLESS GO systems. The group is suspected of stealing at least 34 vehicles worth more than €1.4 million. The cars were primarily stolen in the German region of Heilbronn.
MARITIME BUSINESSES FACE CHALLENGING CYBER THREATS AS GEOPOLITICAL TENSIONS RISE IN THE MEDITERRANEAN
An article from Control Risks says that it has identified a range of threats both to organisational assets, such as shipping and operational technology, and to personnel, driven by the geopolitical flashpoints between key actors in the region – mentioning Syria, Libya and (the waters around) Cyprus.
US HAS, FOR THE FIRST TIME, LEVIED TERRORISM CHARGES AGAINST A MS13 GANG LEADER AND DRUGS TRAFFICKER
An article on 22 July from Insight Crime says that the US government has for the first time levied terrorism charges against a little known MS13 gang leader, but the indictment comes off more like a political ploy than a genuine effort to go after the group. The 8 “terrorism-related offenses” ranged from participating in a racketeering conspiracy and providing support to terrorists, to narco-terrorism and conspiracy to finance terrorism. The article argues that the details of the indictment do not justify the US Government’s argument to charge the leader with terrorism, and that it is a serious stretch to label it a terrorist group with the likes of Hezbollah or Al Qaeda.
https://www.insightcrime.org/news/analysis/us-indictment-ms13-leader/
GERMANY TIGHTENS FOREIGN INVESTMENT REGIME DUE TO THE EU SCREENING REGULATION
On 22 July, an article from Out-Law claims that more transactions can become subject to governmental screening and closing restrictions under the latest amendments to German foreign trade law. It also says that the EU Regulation provides for a uniform approach to investment screening throughout Europe and a cooperation mechanism between the member states and the EU Commission.
FRENCH TRIAL SOUGHT FOR ALLEGED RUSSIAN BITCOIN CRIMINAL ALEXANDER VINNIK
On 22 July, Security Week reported that prosecutors in Paris have asked investigating judges to order a criminal trial for the Russian suspected of money laundering on the bitcoin exchange BTC-e, and who is also wanted by the US and Russia. He was extradited in January from Greece, where he was arrested on an US warrant in 2017. Vinnik has denied the charges and has sought an extradition to Russia, where he is wanted on lesser fraud charges. On 22 June, the media site had reported that New Zealand police said that they had frozen NZ$140 million (US$90 million) in assets linked to Vinnik.
https://www.securityweek.com/french-trial-sought-alleged-russian-bitcoin-criminal
3 ARRESTED FOR STATE SECRETS THEFT IN HANOI MONEY LAUNDERING SCANDAL
On 22 July, VN Express reported that 3 people linked to the government and police have been arrested for stealing classified documents in a money laundering scandal involving a tech business and are are under criminal investigation for “appropriating documents containing state secrets”. The tech company was set up in 2001 and was involved in electronic and telecom equipment and components, mobile phone manufacturing, pawnbroking and as a travel agency services. To date, 26 people have been arrested and investigated for involvement in the case.
SOME CHINESE PORTS BECOMING CLOGGED BECAUSE OF RENEWED INTENSIVE TESTING
On 21 July, Insurance Maritime News reported that the testing of imported foods for Covid-19 has been stretching the processing capacity at some major Chinese seaports. Shippers have warned of the possibility of additional fees and perhaps even diversions to other ports. China increased its number of inspections of imported food in June after an outbreak of Covid-19 among people working at and visiting a major food market in Beijing.
INDIA AMENDS EXPORT CONTROLS – ADDITIONAL GOODS SUBJECT TO CONTROL
On 11 July, changes were made to the list of goods affecting such things as certain nuclear materials, toxic chemical agents listed by the Organisation for the Prohibition of Chemical Weapons (as well as related technology and software), aero-engines and certain aircraft engine technology. Updated descriptions etc include the entries in the nuclear, munitions and telecommunications lists.
https://content.dgft.gov.in/Website/Noti%2010%20dated%2011.06.2020%20-%20SCOMET%20update_0.pdf
AMERICAN BUSINESS CONFIDENCE IN HONG KONG SINKS
On 22 July, an article from CSIS reflects on a new membership survey from the American Chamber of Commerce in Hong Kong (AmCham HK). It says that the most important result is the survey shows that over 35% of foreign businesses are considering relocating their capital, asset, or operations. 5.5% of those businesses are planning to relocate in the short-run and 30.1% in the medium-to-long run.
https://www.csis.org/blogs/trustee-china-hand/american-business-confidence-hong-kong-sinks
ASSESSING RUSSIAN INFLUENCE IN THE UK
This report from CSIS on 20 July the UK case study of an ambitious year-long CSIS initiative to analyse Russian influence activities in the UK and Germany and Chinese influence activities in Japan and Australia. It concludes that, for the past 15 years, Russia has sought to weaken the UK internally and diminish its position in the world by exploiting minority grievances, encouraging separatist movements, amplifying anti-EU sentiments, and trying to inflict reputational damage upon the UK role in NATO and the value of its relationship with the US.
AMENDED UKRAINE- AND RUSSIA-RELATED FAQ
On 22 July, OFAC issued 9 amended Ukraine-/Russia-related FAQ to reflect the issue of General Licenses 130 (Authorizing Certain Transactions Necessary to Divest or Transfer Debt, Equity, or Other Holdings in GAZ Group) and 151 (Authorizing Certain Activities Involving GAZ Group).
https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20200722.aspx
SINGAPORE OIL TRADER HONTOP FACES FRAUD CLAIMS: WHAT WENT WRONG?
On 22 July, an article in Global Trade Review reports that Singapore’s Hontop Energy has becomes the latest oil trader to be embroiled in a fraud scandal, accused of creating elaborate fake trades and forging documents in order to obtain finance. The article examines what went wrong in a sector already under intense pressure. It follows recent collapses of other traders Agritrade, Hin Leong and ZenRock – also amid allegations of fraud.
https://www.gtreview.com/news/asia/singapore-oil-trader-hontop-faces-fraud-claims-what-went-wrong
DANSKE BANKS IMPROVES AML MEASURES IN NORWAY AFTER FSA INSPECTION
On 22 July, Reuters reported that Danske Bank will strengthen its AML measures in its Norwegian branch following an inspection by the country’s regulator.
US CHARGES 2 CHINESE NATIONALS WITH COVID-RELATED HACKING
On 22 July, Lawfare reported that the US DoJ has announced the indictments against 2 Chinese private citizens for unauthorised infiltration of computers and the theft of terabytes of COVID-19 research data. Charges include conspiracy to access without authorization and damage computers, conspiracy to commit theft of trade secrets, unauthorized access to computers, conspiracy to commit wire fraud, along with 7 counts of aggravated identity theft. The indictment outlines the pair’s alleged history, beginning in 2009, of hacking private companies’ across an array of sectors in Europe, Japan, South Korea and the US, along with the computers belonging to the Department of Energy.
https://www.lawfareblog.com/justice-department-charges-two-chinese-nationals-covid-related-hacking
FBI INVESTIGATION SHOWS OHIO’S ENERGY LAW WAS FUELED BY CORRUPTION
On 22 July, an article in Vox is concerned with corruption in the energy sector in Ohio, in the light of charges and arrests including of the Ohio Speaker of the House of Representatives Larry Householder.
https://www.vox.com/2020/7/22/21334366/larry-householder-affidavit-ohio-bribery-firstenergy
CALIFORNIA RESIDENT PLEADS GUILTY TO LAUNDERING MILLIONS USING ILLEGAL BITCOIN ATM
On 22 July, Coindesk reported that Kais Mohammad, aka “Superman29,” has agreed to plead guilty to federal charges he ran an unlicensed Bitcoin ATM network that laundered up to $25 million, including funds that originated in criminal activity. He is said to have pleaded guilty to money laundering, operating an unlicensed money transmitting business and failure to maintain an effective AML programme.
CFTC POSTPONES PROSECUTION OF US COIN BULLION DUE TO CORONAVIRUS
On 22 July, Finance Magnates reported that the US Commodity Futures Trading Commission has sought to postpone the trial of 2 brothers who defrauded some 150 customers of more than $8 million due to precautions over the novel coronavirus. Salvatore and Joseph Esposito, the owners of precious metals investment firm U.S. Coin Bullion pleaded guilty in October 2019 on charges of conspiracy to commit wire fraud and mail fraud. CFTC also filed a civil enforcement action charging US Coin Bullion and its operatives with misappropriating customer funds and engaging in fraudulent solicitations.
US PROSECUTORS SAY SAN FRANCISCO CONSULATE IS HARBOURING CHINESE MILITARY RESEARCHER WANTED BY FBI
On 22 July, Axios reported that Tang Juan, a researcher who lied about her affiliation with a Chinese military university, entered the Chinese consulate in San Francisco after being interviewed by the FBI on about alleged visa fraud and has remained there, according to the FBI.
HUMAN RIGHTS DUE DILIGENCE: INCREASING REGULATORY PRESSURE FOR CLEAN SUPPLY CHAINS
On 22 July, an article from Akin Gump says that there is increasing regulatory, commercial and media attention in the UK and the EU regarding the role of human rights in company supply chains. The UK and the EU are also introducing specific measures around human rights, of which companies and investors should be aware. Businesses should focus on what is expected and/or required of them in terms of identifying and mitigating modern slavery and human rights related risks in their supply chains or portfolios.
https://www.jdsupra.com/legalnews/human-rights-due-diligence-increasing-98309/
EXTENSION OF UK TRUST REGISTER LIMITED FOR NON-UK RESIDENT TRUSTS WITH NO UK TAX LIABILITY
On 22 July, an article from Bryan Cave Leighton Paisner says that non-UK resident trusts where all the trustees are non-UK resident and where the trust has no UK tax liability or directly-held UK assets will not have to register on the UK trust register simply because they enter into a business relationship with UK lawyers, banks, estate agents or accountants. This, it says, is confirmed by the release of draft regulations to extend the scope of the register.
https://www.jdsupra.com/legalnews/extension-of-uk-trust-register-limited-43249/
CONTROLLING OPIOID SUPPLY FROM MEXICO
One of a cluster of reports from the Brookings Institute on 22 July included this one which explores policy options for responding to the supply of heroin and synthetic opioids from Mexico to the US.
https://www.brookings.edu/wp-content/uploads/2020/07/9_Felbab-Brown_Mexico_final.pdf
CONTROLLING OPIOID SUPPLY FROM CHINA
Another paper from the Brookings Institute on 22 July says that, since 2013, China has been the principal source of the fentanyl flooding the US illicit drug market — or of the precursor agents from which fentanyl is produced, often in Mexico — fuelling the deadliest drug epidemic in US history. China finally announcing in April 2019 that the production, sales, and export of all fentanyl-class drugs are prohibited, except by authorised firms which the Chinese government has granted special licences. This policy paper draws on lessons from several sets of regulatory domains in China to identify the conditions under which China enforces its regulations.
https://www.brookings.edu/wp-content/uploads/2020/07/8_Felbab-Brown_China_final.pdf
ZIMBABWE COURT SUSPENDS POLICE SEARCH WARRANT AGAINST ECONET PHONE OPERATOR
On 22 July, VoA reported that Zimbabwe’s High Court has suspended a police search warrant against mobile telecoms company Econet Wireless which sought to force it to turn over details of subscribers and transactions as part of a money laundering probe. The government says black market foreign currency traders are using Econet’s mobile money platform to undermine the local currency and launder money.
PARCELS MAINTAIN GROWTH OF POSTS GLOBALLY
On 16 July, Parcel and Post Technology reported that a report by the IPC (International Post Corporation) has found that parcels remained the key driver of growth in the postal industry in 2019. The report identified worldwide growth of 4.2% for posts, buoyed by e-commerce and despite a continued decline in mail volume.
MALAWI: CHINESE TRAFFICKERS JAILED IN BLOW TO ANIMAL PARTS TRADE
On 22 July, The Times reported that one of Africa’s most prolific wildlife smuggling rings, which included 7 Chinese, has been put out of business after 9 traffickers were given hefty jail terms by a Malawian court. Quinhua Zhang, 43, regarded as the matriarch of the Lin-Zhang gang, was jailed for 11 years for illegally possessing rhino horn and an unlicensed firearm.
