A news release from US Immigration and Customs Enforcement on 22 July announced that CWD LLC, which operates under the name Centric Parts, a Delaware corporation, has agreed to pay $8 million to resolve allegations that it violated the False Claims Act and the Tariff Act of 1930 by knowingly underpaying customs duties owed to the US on imported brake pads. The allegations were that, from 2007 to 2017, Centric Parts falsely claimed on entry documents that mounted brake pads, which carry a 2.5% tariff, were unmounted brake pads, which require no duty payment – and that when confronted with the misclassifications in 2017, company officials decided to conceal and not disclose the past false entry documents to US Customs & Border Protection. 2 “whistleblowers,” will receive a total of $1.48 million as their share of the settlement. Although Centric Parts has filed for bankruptcy protection, the bankruptcy court entered an order confirming the company’s plan of reorganization that explicitly provides the settlement debt is non-dischargeable and will be paid by the reorganised company.
Day: July 28, 2020
UN AMENDS 6 ENTRIES ON ITS CENTRAL AFRICAN REPUBLIC SANCTIONS LIST
On 28 July, the UN advised that the relevant sanctions committee established pursuant to UN SCR 2127 (2013) concerning the Central African Republic had amended details of 6 existing entries on the sanctions list.
OFAC ADDS 2 NAMES OF FINANCIAL FACILITATORS LINKED TO ISIS
On 28 July, OFAC advised that 2 individuals described as ky ISIS financial facilitators have been added to the SDN Lists. They are located in Syria and Turkey and provided financial support to ISIS
https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20200728_33.aspx
A FAST WAY TO IDENTIFY FRAUD RISKS AND VULNERABILITIES: PROACTIVE INTEGRITY REVIEWS (PIR)
On 4 June, the Basel Institute on Governance blog published a guest article which explains how risk-based Proactive Integrity Reviews have helped to uncover vulnerabilities and fraud risks in European Investment Bank–funded projects. The general principles are available for anyone to adapt and use. It says that early identification of fraud risks or vulnerabilities in projects is a major concern of investors and international financial institutions. It is said that the Fraud Investigations Division of the EIB uses Proactive Integrity Reviews or PIRs to identify potential vulnerabilities and major fraud risks in EIB-funded operations and projects. These reviews are different from classic investigations triggered by allegations of misconduct – they are launched proactively and based on a risk assessment or a request from another internal service. This makes them a very useful way to identify misdeeds before they are noticed – and even before they occur. The aim of a PIR is to –
- detect red flags or indicators of fraud, corruption, collusion or coercion;
- identify possible integrity risks; and/or
- determine the project’s susceptibility to misuse of funds.
The approach is described as constructive, seeking to identify –
- indicators that a project is vulnerable to or suffers from fraud or corruption (“red flags”);
- the nature and extent of any problems or issues;
- areas for possible follow-up, remediation/intervention and/or investigation; and
- recommendations and/or mitigating measures to prevent recurrence or mismanagement.
The General Principles also give guidance on conducting a risk assessment and carrying out the review, from planning and fieldwork to follow-up.
VENEZUELA: US STATE DEPARTMENT DESIGNATION OF FORMER OFFICIALS OF MADURO REGIME RE ALLEGED INVOLVEMENT IN CORRUPTION
A news release from the State Department on 28 July announced the designation of former Venezuelan Minister of Electric Power and President of Corpoelec, Luis Alfredo Motta Dominguez, and former Venezuelan Deputy Minister of Finance, Investment, and Strategic Alliances for the Ministry of Electric Power and Director of Procurement of Corpoelec, Eustiquio Jose Lugo Gomez. They are designated for alleged involvement in corrupt activities in exchange for awarding lucrative supply equipment contracts for Venezuela’s state-owned electricity company, Corpoelec, and for misappropriating public funds for their own self-enrichment. As a result, they and their immediate families are barred from entry into the US.
SAUDI INFLUENCERS AND BOUTIQAAT E-COMMERCE COSMETICS AND FASHION BUSINESS LINKED TO KUWAIT MONEY LAUNDERING SCANDAL
On 28 July, Gulf News reported that 25 Saudi influencers are on the radars of state security intelligence in connection with a Kuwaiti money laundering scandal, Saudi media has reported. The Kuwait public prosecution has charged 10 Kuwaiti influencers with money laundering and ordered to freeze the accounts of Boutiqaat, one of the largest e-commerce cosmetics and fashion businesses in the Middle East.
THE USE OF THE “EX WORKS” INCOTERM CLAUSE FROM THE PERSPECTIVE OF EXPORT CONTROL
On 27 July, an article from MME Legal Tax Compliance in Switzerland starts by saying that the use of international trade terms provided by Incoterms 2020 offers parties to an international trade transaction a standardised way of handling their contractual relationship. They create legal certainty in international and commercial transactions and prevent misunderstandings and disputes between the parties. They are generally recognised by international courts, but only become effective if the parties have reached a contractual agreement on their use. The article focuses on EXW (“Ex Works”), which means that the seller offers his goods for sale at his premise (literally, “ex works”) and the buyer is obliged to collect the purchased goods from the place of sale, which is why the EXW clause is also referred to as the “collection clause”. However, the article warns that is not suited to international trade and should not be used when the buyer cannot complete export formalities. A more suitable alternative would be Free Carrier (FCA), which requires the seller to complete customs declarations and obtain any authorisations necessary for the export of items, technology, software or know-how.
OFAC SETTLEMENT WITH WHITFORD WORLDWIDE COMPANY LLC RE POTENTIAL CIVIL LIABILITY FOR APPARENT VIOLATIONS OF THE IRANIAN SANCTIONS REGULATIONS
On 28 July, OFAC announced that the Pennsylvania-based cookware coating company had settled with OFAC over its potential civil liability for 74 apparent violations of the Iranian Transactions and Sanctions Regulations by Whitford and its subsidiaries in Italy and Turkey 2012-15. OFAC determined that Whitford voluntarily disclosed the apparent violations and that the apparent violations constitute a non-egregious case. The company has agreed to pay $824,314 to settle its potential civil liability for its foreign subsidiaries’ sales to Iran.
https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20200728.aspx
https://www.treasury.gov/resource-center/sanctions/CivPen/Documents/20200728_whitford.pdf
MALTA: UNEXPLAINED WEALTH ORDER LAW PLACED ON BACKBURNER
On 27 July, Malta Today reported that an attempt to introduce an “unexplained wealth order” law by the justice minister has been placed on the backburner, as it was not met with unanimous favour inside the Cabinet.
UK AMENDS 5 ENTRIES ON THE YEMEN SANCTIONS LIST
On 28 July, a Notice from HM Treasury advised that there had been a correction for 5 listings in the Yemen sanctions regime.
raytodd.blog 