OTHER THINGS YOU MAY HAVE MISSED – JULY 28

Panama Covid-19 update – in the news today, the health ministry inspecting casinos to check progress in the implementation of sanitary measures and health protocols for when they reopen…not sure if this is a priority, but it reportedly generates more than 10,000 jobs nationwide and around $75 million dollars in (badly needed) government revenue – though only from those of us trapped in the country, of course.  Mind you, the last time I visited one was over 5 years ago, and that one has now closed down.

Meanwhile, another 781 new cases, meaning that there are 24,693 active cases – as another 1,095 are shown as recovered.  Another 27 fatalities take us to a total of 1,349 to date, of which only 14 were under 20 years old (about 1% of the total).  There are 22,577 people recovering at home, 694 in the hotels and 1,422 in hospital, of whom 148 are in ICU.

28 July 2020

US: POLICE REQUESTS FOR GOOGLE USERS’ LOCATION HISTORIES FACE NEW SCRUTINY

On 27 July, the Wall Street Journal reported that police use of a type of warrant to monitor Google users’ locations en masse is facing its first legal and political challenges as scrutiny of law enforcement tactics grows.  Criminal defendants in Virginia and San Francisco are disputing “geofence” warrants, which authorities can use to scan geographic areas and time periods for suspects through user location histories stored by technology companies. As these motions await arguments and potential decisions as soon as August, New York lawmakers are pushing legislation to ban the practice.

https://www.wsj.com/articles/police-requests-for-google-users-location-histories-face-new-scrutiny-11595842201

VISA AND MASTERCARD HAD FINED WIRECARD FOR DUBIOUS TRANSACTIONS

On 27 July, the Wall Street Journal reported that the payments processor Wirecard AG miscoded gambling transactions and had high levels of stolen card purchases and reversed transactions, leading to hefty fines from card networks Visa Inc and Mastercard Inc, according to people familiar with the matter. It is said that Visa and Mastercard each imposed fines exceeding $10 million more than a decade ago, and the networks remained wary of Wirecard’s business.

https://www.wsj.com/articles/visa-mastercard-fined-wirecard-for-dubious-transactions-11595874886

NAJIB RAZAK, FORMER MALAYSIAN PRIME MINISTER, FOUND GUILTY IN 1MDB CASE

On 28 July, the Wall Street Journal reported that, in the first case linked to the 1MDB scandal, former Malaysian PM Najib Razak was sentenced to 12 years imprisonment (to run concurrently with shorter prison terms of 10 years for each of the 3 charges of money laundering and 3 charges of criminal breach of trust against him) and fined nearly $50 million by a Malaysian court that found him guilty of abuse of power in connection with one of the world’s largest financial scandals that resulted in his defeat in the country’s 2018 elections.

https://www.wsj.com/articles/najib-razak-former-malaysian-prime-minister-found-guilty-in-1mdb-case-11595912007

THE THREAT OF THE ISLAMIC STATE’S EXTENSIVE USE OF IMPROVISED EXPLOSIVES

On 21 July, the International Centre for Counter-Terrorism in The Hague published one of a series of papers, one of which says that the Islamic State’s extensive use of anti-personnel landmines and IED sets a precedent, demonstrating that explosive decontamination needs to be considered as an active component of counter-terrorism, and the use of explosives in the Iraq/Syria region goes beyond conventional warfare, perversely permeating the zones of everyday civilian life – an ICCT study illustrates how contamination covers outdoor areas, buildings and residences. The paper argues that IED and landmines will be increasingly used as tools of terror by violent non-state actors.

https://icct.nl/publication/the-threat-of-the-islamic-states-extensive-use-of-improvised-explosives/

SHAMIMA BEGUM, CITIZENSHIP REVOCATION AND THE QUESTION OF DUE PROCESS

On 17 July, the International Centre for Counter-Terrorism in The Hague published one of a series of papers, which concerned the question of whether or not a young British woman who left the UK to join IS in Syria has the right to return to the UK to challenge the stripping of her British nationality.  She was born in the UK to parents of Bangladeshi origin, but had her UK citizenship – the only one she holds – revoked in 2019.  She has now won an appeal to allow her to return to challenge the decision. The Home Office has indicated its intention to appeal the judgment and , if the Home Office’s appeal is denied, she will be entitled to return to the UK.

https://icct.nl/publication/shamima-begum-citizenship-revocation-and-the-question-of-due-process/

WILL YOUR ANTI-BRIBERY COMPLIANCE PROGRAMME STACK UP IN A COURT OF LAW?

An article from Nyman, Gibson & Miralis in Australia says that, in its Operational Handbook, the UK SFO sheds some light on the key factors it considers in assessing the effectiveness of an organisation’s compliance programme as part of an investigation. The short article uses the Handbook as a guide.

https://ngm.com.au/anti-bribery-compliance-program-key-considerations/

NEW AMENDMENTS TO THE ROMANIAN AML/CFT FRAMEWORK

On 22 July, an article from DLA Piper says that, while the amendments are extensive, the article has outlined a few of the relevant changes to the general legal framework in the field of money laundering and terrorist financing prevention.

https://www.dlapiper.com/en/global/insights/publications/2020/07/new-amendments-to-the-romanian/

BLACKLISTED RUSSIAN GROUP’S LIBYA OIL GRAB FUELS TENSIONS IN THE MIDDLE EAST

On 26 July, an article in the Wall Street Journal reported that military contractors linked to the Russian government – armed fighters from the Wagner Group – have seized control of 2 of Libya’s largest oil facilities in recent weeks, heightening tensions between Russia and the US over Moscow’s growing footprint in the Libya.  It is said that US officials are concerned that the Russian mercenaries have shifted their focus to taking control of Libya’s oil industry, and the Russian mercenaries now hold sway on key export flows to Europe and assets partly owned by major Western oil companies.

https://www.wsj.com/articles/russian-oil-grab-in-libya-fuels-u-s-kremlin-tensions-in-mideast-11595772000

AUSTRALIA: WESTPAC’S AML ISSUES WIDEN WITH MORE REPORTING FAILURES

On 28 July, the Sydney Morning Herald reported that Westpac failed to report tens of thousands of large cash transactions to financial crimes watchdog, AUSTRAC.  It revealed 175,000 transactions that it failed to report to the regulator and a further 365,000 reports that may have included incomplete or inaccurate information.

https://www.smh.com.au/business/banking-and-finance/westpac-discloses-more-austrac-reporting-failures-20200728-p55g24.html

US CUSTOMS AND GUATEMALAN AUTHORITIES HAVE SEIZED 2 TONNES OF COCAINE AND A GULFSTREAM III EXECUTIVE JET

On 28 July, a news release from US Immigration & Customs Enforcement advised that the expensive long-range jet was bought in the US, taken to Mexico for maintenance, then flew into Venezuela and ended up in Guatemalan territory where it was interdicted by the Guatemalan military. The narco-traffickers scuttled the aircraft and attempted to bury the cocaine.

https://www.ice.gov/news/releases/ice-hsi-orlando-hsi-guatemala-seize-aircraft-cocaine

ECOWAS THREATENS SANCTIONS AGAINST MALI’S OPPOSITION

On 28 July, Deutsche Welle reported that West African leaders are trying to resolve the political crisis in Mali, urging opposition groups to support the new unity government, while warning of consequences for those who stand in the way of a resolution.  They have urged Mali’s opposition groups to join the country’s new unity government in a bid to end a political stalemate that threatens to tear the country apart. ECOWAS also asked Mali’s 31 current parliamentarians to resign – including the speaker of the National Assembly – in order to pave the way for new elections.

https://www.dw.com/en/ecowas-threatens-sanctions-against-malis-opposition/a-54245045

https://www.defenceweb.co.za/governance/governance-governance/why-mali-is-in-turmoil-again/

MALTA CHAMBER OF COMMERCE PRESENTS MONEYVAL EVALUATION RECOMMENDATIONS

On 28 July, Newsbook in Malta reported that the Malta Chamber of Commerce, Enterprise and Industry has presented to the government a document: ‘Recommendations for the Moneyval Assessment’, concerned with the impending Moneyval evaluation.  It is said that the Chamber has established a forum composed of The Malta Chamber’s Financial Services Business Section, Malta Bankers Association, Chamber of Advocates, Malta Institute of Accountants, Institute of Financial Services Practitioners and Malta Institute of Taxation; and it has proposed the appointment of one technical, apolitical national spokesperson on Moneyval-related matters.

https://newsbook.com.mt/en/malta-chamber-presents-moneyval-evaluation-recommendations/

https://www.independent.com.mt/articles/2020-07-28/local-news/Succeeding-the-Moneyval-test-is-a-shared-responsibility-Chamber-of-Commerce-6736225583

https://www.maltachamber.org.mt/en/succeeding-the-moneyval-test-is-a-shared-responsibility

INDIA: ENFORCEMENT DIRECTORATE RAIDS MULTIPLE PREMISES IN MUMBAI AIRPORT MONEY LAUNDERING CASE

On 28 July, Money Control reported that the raids were carried out at 9 locations in Mumbai and Hyderabad and are said to be connected to a money laundering case against GVK group, Mumbai International Airport Limited (MIAL) and others to probe alleged irregularities in running the Mumbai airport.

https://www.moneycontrol.com/news/india/ed-raids-multiple-premises-in-money-laundering-case-against-gkv-group-mial-5611261.html

SINGAPORE: MAS REVOKES CAPITAL MARKETS SERVICES LICENCE OF APICAL ASSET MANAGEMENT FOR BREACHING AML/CFT REQUIREMENTS

On 28 July, the Straits Times reported that the Monetary Authority of Singapore (MAS) had revoked the licence and the firm’s chief executive director were also reprimanded for failing to discharge their duties and functions of ensuring that the asset manager complied with all laws and regulations governing its operations.

https://www.straitstimes.com/business/banking/mas-revokes-licence-of-apical-asset-management-on-anti-money-laundering-breaches

https://mondovisione.com/media-and-resources/news/monetary-authority-of-singapore-revokes-licence-of-apical-asset-management-pte/

CHINA: 6 PROSECUTED FOR LAUNDERING OVER $14 MILLION

On 28 July, Shine in China reported that during the investigation of a major fraud case involving 2 of the accused city prosecutors in Shanghai found that their family members, a neighbour and even the neighbour’s subordinate were also connected with the case. It is said that 5 of the accused have pleaded guilty so far and can be eligible for less severe punishments. The assets involved included cash and 25 kg of gold

https://www.shine.cn/news/metro/2007283077/

UK: LAW SOCIETY VIEW ON LEGAL PROFESSIONAL PRIVILEGE (LPP) FOR DAC6 PURPOSES

On 28 July, a briefing from Bird & Bird is concerned with the implications of DAC 6, which imposes a disclosure obligation on ‘intermediaries’ who advise on, or are involved in, implementing ‘cross-border arrangements’. However, the briefing points out, a disclosure could be in breach of LPP, and therefore the regulations provide for an exception to the reporting obligations. But what is covered by LPP?  The briefing provides a summary of the Law Society of England & Wales views on the matter.

https://www.twobirds.com/en/news/articles/2020/uk/uk-law-societys-view-on-legal-professional-privilege-for-dac6-purposes

EU PUBLIC PROSECUTOR’S OFFICE (EPPO): COUNCIL APPOINTS EUROPEAN PROSECUTORS

On 28 July, a news release from the EU Council advised that the prosecutors will supervise investigations and prosecutions and will constitute the EPPO College, together with the European Chief Prosecutor.  Each Member State nominated the candidates for the position of European prosecutor. These must be candidates who are active members of the public prosecution service or judiciary, whose independence is beyond doubt and who possess the qualifications required for appointment to high prosecutorial or judicial office in their respective Member States. The EPPO will be an independent body of the EU responsible for investigating, prosecuting and bringing to judgment crimes against the financial interests of the EU (e.g. fraud, corruption, cross-border VAT fraud above €10 million). In that respect, the EPPO shall undertake investigations, and carry out acts of prosecution and exercise the functions of prosecutor in the competent courts of the Member States.

https://www.consilium.europa.eu/en/press/press-releases/2020/07/27/eu-public-prosecutor-s-office-eppo-council-appoints-european-prosecutors/

ILLICIT FINANCE IS A UK NATIONAL SECURITY THREAT

On 28 July, a Commentary from RUSI argues that the illicit finance challenge faced by the UK and highlighted in the recent parliamentary report into Russian operations threatens to be overwhelming, and that urgent and radical action is required.

https://www.rusi.org/commentary/get-serious-illicit-finance-uk-national-security-threat

PLEXCOIN SCAM FOUNDERS CHARGED WITH FRAUD IN US

On 28 July, Coingeek reported that the US DoJ has unveiled an indictment charging the founders of PlexCoin with wire and securities fraud – the 3 founders, all from Quebec, allegedly sold the tokens to investors in 2017, and got away with $8 million.

https://coingeek.com/plexcoin-scam-founders-charged-with-fraud-in-us

FIRST HEARING BEGINS IN MEXICO’S CORRUPTION TRIAL OF EX-PEMEX BOSS

On 28 July, Metro and others reported that Emilio Lozoya, 45, the former head of Mexican state oil company Pemex, has appeared in court for an initial hearing on corruption charges. He was CEO of the company formally known as Petroleos Mexicanos from 2012 to 2016 under former President Enrique Pena Nieto, and faces accusations ranging from accepting bribes to money laundering. He was arrested in, and extradited from, Spain.

https://www.metro.us/first-hearing-begins-in

https://apnews.com/af5428c2ddfef66985030b5c6ec7c689

BANK OF IRELAND FINED €1.66 MILLION FOR FAILINGS AMID CYBERFRAUD

On 28 July, the Irish Times reported that the Bank has been fined €1.66 million by the Irish Central Bank for regulatory breaches, after it transferred more than €100,000 to a fraudster who hacked a client’s e-mail account 6 years’ ago. It is said that  it only alerted police to the incident more than a year afterwards, and only did so at the request of supervisors. The bank would also mislead the Central Bank during an investigation into the matter.

https://www.irishtimes.com/business/financial-services/bank-of-ireland-fined-1-66m-for-failings-amid-cyberfraud-1.4315693

US CUSTOMS INTERCEPTS AN ARRAY OF COUNTERFEIT HIGH FASHION PRODUCTS WORTH $1.8 MILLION AT LAX

A news release from US Customs & Border Protection advised that officers seized 3,524 counterfeit handbags, shoes, watches, sunglasses, t-shirts, purses, sandals and ball caps arriving from Hong Kong.

https://www.cbp.gov/newsroom/local-media-release/cbp-intercepts-array-counterfeit-high-fashion-products-worth-18-million

GERMAN CUSTOMS BUREAU LAUNCHES ANOTHER PROBE INTO ILLEGAL PV MODULE IMPORTS

On 24 July, PV Magazine reported that German authorities have issued 14 search warrants in Bavaria, Baden-Württemberg, Schleswig-Holstein, and Berlin.  The probe is related to imports of 480,000 solar panels in 2014 and 2015, when the EU had anti-dumping and anti-subsidy duties on Chinese solar products. Around 100 German Customs officials raided offices and searched private homes in Munich, Stuttgart, Hamburg and Berlin and directed against 2 companies, members of their management teams, and other witnesses and at least €33 million in anti-dumping duties and import sales taxes in connection with the shipments from China.

https://www.pv-magazine.com/2020/07/24/german-customs-bureau-launches-another-probe-into-illegal-pv-module-imports/

HONG KONG CUSTOMS SEIZE 142 TONNES OF WOOD LOGS OF ENDANGERED SPECIES

On 27 July, The Standard reported that Customs announced that in 3 smuggling cases involving scheduled wood logs at the Kwai Chung Customhouse Cargo Examination Compound between June 30 and July 16, a total of about 142 tonnes of scheduled wood logs of endangered species, worth about HK$1.2 million, were seized.

https://www.thestandard.com.hk/breaking-news/section/4/151811/Customs-seize-HK$1.2m-scheduled-wood-logs

LITHUANIA LAUNCHES CRIMINAL PROBE INTO CHINESE MASK TRADERS

On 28 July, OCCRP reported that Lithuanian authorities have launched an investigation into the procurement of Chinese-made protective face masks that apparently had fake certificates. A shipment of 30,000 Chinese masks, called ‘Love Surprise,’ had a certificate of ICR Polska, a Poland-based notified body that is not authorized to certify personal protective equipment.

https://www.occrp.org/en/daily/12859-lithuania-launches-criminal-probe-into-chinese-mask-traders

UK: LANDLORD WHO CONVERTED HOUSE IN 12 FLATS LOSES APPEAL OVER £500,000+ CONFISCATION ORDER

On 27 July, Local Government Lawyer reported that a defendant who turned a house into 12 flats without planning permission has lost an appeal over the subsequent imposition of a confiscation order for more than £500,000. The sole issue raised on the appeal against sentence was that the judge failed to give any due credit to the appellant for his early plea of guilt, but issues raised on the appeal against the confiscation order were more wide-ranging – and included that the rents accruing to the appellant were not sufficiently linked, in terms of causation, to the breach of the enforcement notice.

https://www.localgovernmentlawyer.co.uk/planning/401-planning-news/44449-landlord-who-converted-house-in-12-flats-loses-appeal-over-500k-confiscation-order

UK: SEARCH WARRANTS FOLLOWING AN INTERNATIONAL LETTER OF REQUEST

An article from 5 St Andrews Hill Chambers on 27 July was concerned with the latest in an application for judicial review brought by Terra Services Ltd against the NCA, the Secretary of State and Inner London Crown Court. It was held that 2003 Act involved did not require the UK Central Authority to decide for itself which statutory search power should be the subject of a direction; it was for the relevant authority to which it sent the request to carry out a PACE-compliant inquiry.

https://www.5sah.co.uk/news-and-events/articles/2020-07-27/uk-search-warrants-following-an-international-letter-of-request-r-on-the-application-of-terra-services-ltd-v-nca-lexis-nexis-analysis

THE USE OF CAYMAN “BLANK CHEQUE COMPANIES” IN AN IPO

An article from Appleby on 27 July was concerned with Special Purpose Acquisition Companies (SPAC) from the Cayman Islands and are companies that are formed to raise capital through an IPO to fund a strategic acquisition down the road, typically within 18 to 24 months.  It says that Cayman Islands exempted companies are one of the most popular vehicle choices for SPAC owing to their flexibility and their familiarity to international investors and stock exchanges.

https://www.applebyglobal.com/publications/the-use-of-cayman-islands-structures-for-spac-ipos/

SINGAPORE INTRODUCES REGULATORY REGIME FOR INSOLVENCY PRACTITIONERS AS NEW LAW COMES INTO FORCE

On 28 July, Out-Law published an article saying that the new Insolvency, Restructuring and Dissolution Act will come into force on 30 July, consolidating the jurisdiction’s corporate insolvency and personal insolvency regimes and establishing a regulatory regime for insolvency practitioners.

https://www.pinsentmasons.com/out-law/news/singapore-regulatory-regime-for-insolvency-practitioners

DIRECTORS’ DISQUALIFICATION ORDERS: HIGH COURT DECISION REINFORCES MOVE TOWARDS GREATER ENFORCEMENT

An article from Eversheds Sutherland on 28 July follows a case in which the High Court issued a 7 year disqualification order to a former director of a residential estate agent in Somerset.  It is said to provide further evidence that the Competition and Markets Authority (CMA) is increasingly willing to use disqualification, alongside the imposition of corporate fines, as a tool to encourage compliance with competition law by directors of UK companies. The firm says that directors should therefore be aware that they have a personal responsibility for ensuring that their companies comply with competition law, and that they may be disqualified even if they have not been directly involved in, or had direct knowledge of, competition law breaches. This is particularly important because the CMA now appears to be pursuing director disqualifications as a matter of course following a competition investigation.

https://www.eversheds-sutherland.com/global/en/what/articles/index.page?ArticleID=en/Competition_EU_and_Regulatory/Directors-disqualification-orders-High-Court-decision-reinforces-greater-enforcement_280720

BUSINESS ID THEFT SOARS AMID COVID CLOSURES

On 27 July, the Krebs on Security blog posted an article saying that identity thieves who specialise in running up unauthorised lines of credit in the names of small businesses are having a field day with all of the closures and economic uncertainty wrought by the COVID-19 pandemic.  It says this involves a story about the victims of a particularly aggressive business ID theft ring that has spent years targeting small businesses across the country and is now pivoting toward using that access for pandemic assistance loans and unemployment benefits.

https://krebsonsecurity.com/2020/07/business-id-theft-soars-amid-covid-closures/

WILDLIFE TRAFFICKING: LAW ENFORCEMENT RESPONSES – US PERSPECTIVE

On 27 July, a briefing paper from the US Congressional Research Service provided a summary of US agency involvement and policies, new legislation and issues for Congress.

https://crsreports.congress.gov/product/pdf/IF/IF11605

THE HISTORY OF SAUDI-IRANIAN COMPETITION

The Center for Strategic and International Studies has published the transcript of a webinar which addressed this issue.  They were not always such rivals and competitors, but tracing the current rivalry to 1979 and events of around that time.

https://www.csis.org/analysis/history-saudi-iranian-competition

A REGIONAL OVERVIEW OF THE ISLAMIC STATE’S OPERATIONS IN SOUTH-EAST ASIA

On 20 July, the Combating Terrorism Center at West Point published the first of a 4-part series on the Islamic State in SE Asia which sheds light on the overarching characteristics of Islamic State-linked operations across Indonesia, Malaysia, and the Philippines between 2014 and 2019, highlighting how the Islamic State’s arrival has affected regional militancy. The report identifies 6 regional militant groups as the Islamic State’s operational affiliates, defined as groups that have claimed attacks concurrently with the Islamic State.

https://www.hstoday.us/subject-matter-areas/counterterrorism/rising-in-the-east-a-regional-overview-of-the-islamic-states-operations-in-southeast-asia/

SECRETS AND SPIES: THE UK PROPOSAL FOR FOREIGN AGENT REGISTRATION

On 28 July, an article from Cadwalader says that the recent Parliamentary report on suspected Russian interference in the UK brought attention to the 2017 consultation from the Law Commission’s in relation to updating the Official Secrets Acts, and the possibility of creating a new Espionage Act. It also says that the report made reference to the US Foreign Agents Registration Act 1938 (FARA) and the Australian equivalent. Given the explicit reference to FARA, it is said to be very likely that a registration requirement for foreign agents is imminent, and the new requirement will be fashioned on the US legislative framework. The article then looks at what a UK FARA would look like.

https://www.cadwalader.com/resources/clients-friends-memos/secrets-and-spies-the-uks-proposal-for-foreign-agent-registration

SWISS CANTON IS ABOUT TO BECOME THE WORLD’S TOP TAX HAVEN

On 24 July, an article in The Local says that the central Swiss canton of Nidwalden is one of the countries smallest, but the adoption of a set of tax reforms – partially motivated by the coronavirus crisis – will result in Nidwalden adopting a corporate tax rate of 9.8%.  Currently, Hong Kong has the lowest corporate tax rate in the world but will be undercut by Nidwalden if the changes take effect.

https://www.thelocal.ch/20200724/this-swiss-canton-is-about-to-become-the-worlds-top-tax-haven

MAN BUYS LAMBORGHINI AFTER GETTING NEARLY $4 MILLION IN CORONAVIRUS LOANS, US AUTHORITIES SAY

An article in the Guardian on 28 July reported that a man from Florida who bought luxury goods including a Lamborghini sports car after receiving nearly $4 million in loans from the Paycheck Protection Program (PPP) has been charged with fraud, federal authorities announced.  A DoJ complaint alleges that David Hines applied on behalf of a few companies for about $13.5 million in PPP loans, used money he received to shop at luxury stores and resorts in Miami Beach, then lied about how much he had paid to employees.

https://www.theguardian.com/world/2020/jul/28/man-buys-lamborghini-coronavirus-loans

COLOMBIAN NATIONAL AGREES TO PLEAD GUILTY TO $109 MILLION MEDICARE FRAUD SCHEME IN US

A US DoJ news release on 27 July advised that Juan Camilo Perez Buitrago, 31, a Colombian national residing in Florida, has agreed to plead guilty in connection with submitting more than $109 million in false and fraudulent claims for durable medical equipment (DME) such as arm, back, knee and shoulder braces.

https://www.justice.gov/usao-ma/pr/colombian-national-agrees-plead-guilty-109-million-medicare-fraud-scheme

NIGERIA: COURT JAILS FORMER AIR FORCE CHIEF OVER CORRUPTION

On 28 July, Sahara Reporters reported that the Economic and Financial Crimes Commission has secured the conviction of Air Vice Marshal Alkali Mohammadu Mamu. This followed the appellate court’s reversal of his discharge and acquittal on corruption charges. The court convicted and sentenced him to 2 years imprisonment in respect of one out of the 4 counts. He was one of the senior military officers accused of abusing their positions by the Presidential Committee on the Audit of Defence Equipment Procurement, which was mandated to look into contracts awarded for military procurement.

http://saharareporters.com/2020/07/28/court-jails-ex-air-force-chief-avm-mamu-over-corruption

BRITISH CITIZEN SENTENCED TO 4 YEARS IN PRISON FOR HIS ROLE IN FRAUDULENT INVESTMENT SCHEME 

A news release from the US DoJ on 28 July advised that Savraj Gata-Aura, 33, has been was sentenced to 4 years in prison for participating in a scheme to defraud more than 800 investors of more than $40 million by making false and fraudulent representations about, among other things, the management, profitability, and operations of a co-working space company called Bar Works Inc and related entities. It is said that from approximately September 2015 to June 2017, he partnered with Renwick Haddow, 51, who is also a British citizen, in soliciting investments into Bar Works through material misrepresentations.

https://www.justice.gov/usao-sdny/pr/british-citizen-sentenced-four-years-prison-his-role-fraudulent-investment-scheme

INDEPENDENT EXPERTS CLEAR AFRICAN DEVELOPMENT BANK CHIEF OF CORRUPTION

Fin24 on 28 July reported that an independent panel of experts, headed by former Irish president Mary Robinson, has cleared Akinwumi Adesina, 60, the leader of the African Bank of Development (AfDB) of corruption. A 15-page report earlier this year had claimed that under his watch the bank had been tarred by poor governance, impunity, personal enrichment and favouritism.

https://www.news24.com/fin24/Economy/independent-experts-clear-african-development-bank-chief-of-corruption-20200728

CHINESE NETWORKS DOMINATE THE CHEMICAL AND CASH SECTORS OF THE DRUG CARTEL BUSINESS 

On 28 July, an article in the Epoch Times says that Chinese criminal networks supply tons of drug-making chemicals and launder billions of dollars for cartels, yet most of the attention is focused on the territorial gun battles in Mexico, or when a kingpin such as Joaquin “El Chapo” Guzman is arrested. Among other things, the article mentions that Chinese nationals in the US operate a popular scheme, known as the “Chinese Underground Banking System”, which works not only to launder money for the cartels, but to help Chinese nationals living in the US access massive amounts of cash, according to the DEA.

https://www.theepochtimes.com/chinese-networks-dominate-chemical-cash-sectors-of-drug-cartel-business_3441317.html

IMPLEMENTING CHINA’S NEW FOREIGN INVESTMENT LAW: REPORTING REQUIREMENTS

On 28 July, an article from Pillsbury is the first of a series of alerts focusing on practical issues relating to China’s new Foreign Investment Law which institutes new reporting requirements for foreign investors. It notes that enterprises are now required to divulge what parties have de facto control over them.

https://www.jdsupra.com/legalnews/implementing-china-s-new-foreign-35118/

CENTRIC PARTS TO PAY $8 MILLION TO RESOLVE ALLEGATIONS PAY US IMPORT DUTIES ON BRAKE PADS – AFTER WHISTLEBLOWERS DENOUNCED IT AND DESPITE FILING FOR BANKRUPTCY

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.

https://www.ice.gov/news/releases/centric-parts-pay-8-million-resolve-allegations-failing-pay-united-states-millions

 

 

 

 

 

 

 

 

CENTRIC PARTS TO PAY $8 MILLION TO RESOLVE ALLEGATIONS PAY US IMPORT DUTIES ON BRAKE PADS – AFTER WHISTLEBLOWERS DENOUNCED IT AND DESPITE FILING FOR BANKRUPTCY

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.

https://www.ice.gov/news/releases/centric-parts-pay-8-million-resolve-allegations-failing-pay-united-states-millions

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

https://home.treasury.gov/news/press-releases/sm1070

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 Bankfunded 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.

https://www.baselgovernance.org/blog/fast-way-identify-fraud-risks-and-vulnerabilities-proactive-integrity-reviews

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.

https://www.state.gov/public-designation-of-former-officials-of-the-illegitimate-maduro-regime-due-to-involvement-in-significant-corruption

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.

https://gulfnews.com/world/gulf/saudi/25-saudi-influencers-linked-to-kuwait-money-laundering-scandal-1.72842880

https://www.zawya.com/mena/en/legal/story/Kuwaits_Boutiqaat_being_investigated_for_money_laundering-SNG_180638389/

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.

https://www.mme.ch/en/magazine/magazine-detail/url_magazine/the_crux_of_the_ex_work_incoterm_clause_from_the_perspective_of_export_control/

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.

https://www.maltatoday.com.mt/news/national/103795/unexplained_wealth_order_law_placed_on_backburner#.XyBA91qSmM-