OTHER THINGS YOU MAY HAVE MISSED – JULY 30

Panama Covid-19 update – the national airline, COPA, has said that it has revised its restart plans, after the fourth postponement of the reopening of the main airport.  It has 102 airliners, and planned for 10% to be put back into operation at restart, but now the airline says that maybe only 3 or 4 would be required. This is compared to around 350 take offs and landing daily before the crisis began.  Even if the restart begins in September, daily flights would not be likely before October.

Meanwhile, another 922 new cases and 23 fatalities, the latter taking us to 1,397 total to date, or a 2.2% death-rate.  There are now 24,576 active cases, far outnumbered by the 38,218 “recovered” (with another 902 added today).  1,453 remain in hospital, 161 in ICU, with 23,123 isolated – 666 in hotels and 22,457 at home.  Also notable that, of the 64,191 cases to date, some 73% were in the 20 to 59 age range – where the fatalities are proportionately the least…

30 July 2020

UNIVERSITY OF TEXAS IN FBI PROBE OVER CLAIMS CHINESE GOVERNMENT TRIED TO ILLEGALLY OBTAIN CORONAVIRUS RESEARCH

On 29 July, the South China Morning Post reported that an American university whose work has contributed to some promising Covid-19 vaccine candidates has been contacted by the FBI over allegations that the Chinese consulate in Houston had sought to obtain such research.

https://www.scmp.com/news/china/diplomacy/article/3095242/university-texas-fbi-probe-over-claims-chinese-government

US AUTHORITIES APPREHEND KAZAKHSTANI MAN WANTED FOR EMBEZZLEMENT

A news release from US Immigration & Customs Enforcement advised that Sanzhar Ordaliyev, 33, a citizen and national of Kazakhstan wanted by authorities in his home country on embezzlement charges has been apprehended. In October 2018, he entered the US as a non-immigrant visitor with authorisation to remain in the country for a temporary period. He failed to depart as required, thus violating his non-immigrant status.

https://www.ice.gov/news/releases/ice-apprehends-kazakhstani-man-wanted-authorities-embezzlement

AN E-COMMERCE TECHNIQUE KNOWN AS “BRUSHING” AND SEEDS APPEARING IN MAILBOXES ACROSS THE US

On 29 July, the Wall Street Journal reported that an e-commerce technique known as brushing is being considered as federal officials look to whether the practice is behind a phenomenon of seeds appearing in mailboxes across the country. The US Department of Agriculture said it is collecting the packages and will test them for anything of concern. Brushing is said to be a technique sometimes used to boost a seller’s ratings by creating fake orders. A seller can do this by paying someone a small amount to place a fake order, or just using another person’s information to place an order themselves.

https://www.wsj.com/articles/brushers-arrange-fake-online-sales-to-enhance-sellers-reputations-11596046717

https://www.hstoday.us/subject-matter-areas/infrastructure-security/recipients-advised-to-report-unsolicited-mystery-seed-shipments/

GERMANY ASKS RUSSIA TO HELP FIND FORMER WIRECARD EXECUTIVE

On 29 July, the Wall Street Journal reported that German authorities have asked Russian officials if Jan Marsalek, the former Wirecard AG executive who ran operations for the fintech company, had entered Russia and on 22 July had requested they act on an Interpol Red Notice issued for his arrest.

https://www.wsj.com/articles/germany-asks-russia-to-help-find-former-wirecard-executive-11596056696

 INDIA: ENFORCEMENT DIRECTORATE MONEY LAUNDERING CASE AGAINST FUGITIVE DEFENCE CONSULTANT SANJAY BHANDARI

On 28 July, NDTV in India reported a second money laundering case filed against Bhandari following the 2017 charges re alleged possession of undisclosed assets abroad and other charges in February 2017. The new case involves alleged kickbacks worth $4.99 million allegedly received by him from South Korean company Samsung Engineering in 2009.

https://www.ndtv.com/india-news/enforcement-directorate-files-fresh-money-laundering-case-against-sanjay-bhandari-2269799

CHINESE BANKS URGED TO SWITCH AWAY FROM SWIFT AS US SANCTIONS LOOM

On 29 July, Reuters reported that a report from the investment banking unit of Bank of China has said that companies should prepare for potential US sanctions by increasing use of its own financial messaging network for cross-border transactions in the mainland, Hong Kong and Macau.  Chinese state lenders have been revamping contingency plans in anticipation of US legislation that could penalise banks for serving officials who implement the new national security for Hong Kong.

https://www.reuters.com/article/us-china-banks-usa-sanctions/chinese-banks-urged-to-switch-away-from-swift-as-u-s-sanctions-loom-idUSKCN24U0SN

LESSONS FROM DEUTSCHE BANK’S EPSTEIN FINE

On 30 July, KYC 360 published an article saying that the consent order involved recounts how the bank went wrong “despite knowing Mr. Epstein’s terrible criminal history”, and offers a number of important lessons for compliance teams reviewing high-risk customers of their own. It appears that, as the Epstein relationship was deemed to be “high-risk” and as he was assessed to be a “Honorary PEP” due to his known links to senior politicians, the Epstein accounts were subject to enhanced transaction monitoring. However, such monitoring did not address the individual risks posed by Epstein.  The article considers the lessons to be drawn from the affair.

https://www.riskscreen.com/kyc360/news/questionable-client-lessons-from-deutsche-banks-epstein-fine

UIGHUR WOMAN SENT MONEY TO HER PARENTS IN AUSTRALIA AND CHINA ACCUSES HER OF FINANCING TERRORISM

SBS News in Australia on 18 July reported that the money was said to be help the parents purchase a house, said to having been sent legally in 2013, but now the woman who sent it is facing a court trial in China.  It is said that everything was fine until 2017, when the Chinese government policy on Xinjiang changed, the woman went missing and we later discovered she was in an internment camp for 10 months and she was arrested in 2019.  Bank statements show a total of A$135,000 was sent to the parents in Adelaide via 3 bank transfers in July 2013, with others by an aunt and uncle, who are also facing terrorism-related charges.

https://www.sbs.com.au/news/this-uighur-woman-sent-money-to-her-parents-in-australia-china-accuses-her-of-financing-terrorism

UAE UPDATED EXPORT CONTROL LIST

On 30 July, the EU Sanctions Blog reported that the UAE Committee for Goods and Materials Subject to Import and Export Control has updated its list of goods and equipment subject to controls. It says that export controls have been placed on a number of dual-use goods, equipment and technologies relating to nuclear materials, sensors, avionics, navigation systems, and telecommunication systems – and as agreed under various international agreements.

https://www.europeansanctions.com/2020/07/uae-issues-updated-export-control-list/

US AUTHORITIES APPREHEND ARMENIAN MAN WANTED FOR FRAUD

A news release from US Immigration & Customs Enforcement on 24 July advised that officers successfully apprehended Gevorg Gasparyan, 38, an individual wanted by the Government of Armenia.  Gasparyan is wanted for swindling committed in particularly large amount, forgery, sale or use of forged documents, and abuse of authority by the employee of commercial or other organisations.

https://www.ice.gov/news/releases/ice-apprehends-armenian-man-wanted-fraud

DEFAULTERS IN UAE MAY BE PURSUED IN INDIA

An article from Al Suwaidi & Company on 29 July warned that, in a historical development of India and UAE relationship, UAE Judgment will be recognized and enforceable in India based on reciprocity as per the Notification issued by Government of India on 17 January.  It says that India and UAE entered into an Agreement in 1999 on Juridical and Judicial Cooperation in Civil and Commercial Matters for the Service of Summons, Judicial Documents, Commissions, Execution of Judgments and Arbitral Awards. However, previously it only applied to service of summons, judicial documents or processes, recording of evidence by means of Letters of Request and/or commissions and execution of decrees and arbitral awards. The article says that the Notification is a turning point in execution and enforcement of civil judgment in India issued against persons in UAE by the Superior Courts – as until now it was extremely difficult, costly and time-consuming for the Judgment Creditors in UAE to recover the judgment amount if the debtor had fled to India.

https://www.alsuwaidi.ae/be-aware-defaulters-in-uae-may-be-pursued-in-india-2/

DISCLOSURE: DOCUMENTS HELD BY A SUBSIDIARY MAY BE WITHIN THE “CONTROL” OF THE PARENT AND THE COURT WILL CAREFULLY CONSIDER WHETHER THERE IS A PATTERN OF ACCESS
A item from Addleshaw Goddard LLP on 28 July is one of its “Briefest Case” newsletter for Summer 2020, which provides quick updates on court procedural issues for those dealing with disputes in courts in England & Wales. The item says that the judgment in question is significant in its detailed guidance on the extent of the obligations of a parent company to disclose documents held by subsidiaries. It shows that the court will undertake a careful analysis of arrangements between parent companies and subsidiaries where necessary to assess whether documents are within the parent’s control. The analysis of the 3 elements of consent cited is said to be particularly useful.

https://www.addleshawgoddard.com/en/insights/insights-briefings/2020/litigation/the-brief-case/the-briefest-case/

RUSSIA CONSIDERS EXPANSION OF ITS SANCTIONS REGIME AGAINST UKRAINE

On 29 July, an article from Baker McKenzie reported that on 28 July the State Duma of Russia saw a Draft Bill introduced proposing additional Russian counter-sanctions, which would modify existing sanctions, and also provides for the extensive list of organisations that are bound to block the assets of the sanctioned persons (which includes banks, insurers, non-state pension funds, market participants and some rather specific organizations, e.g. pawnshops and gambling organisers).

https://sanctionsnews.bakermckenzie.com/russia-considers-expansion-of-its-sanctions-regime-against-ukraine/#page=1

BREXIT MODEL PUTS FLOWER SECTOR AT RISK

On 28 July, an article in The Florist reported that the Fresh Produce Consortium (FPC) is calling on Government to avoid a ‘perfect storm’ in 2021 with its Chief Executive taking the lead on making sure flower and plant sales are protected. It is said that unless the UK Government changes its proposed plans for future trading with the EU it will damage the UK plant and cut flower industry, create shortages and increase prices for UK consumers. FPC has been asking the Government to provide essential information which is missing from the Border Operating Model and the Northern Ireland Protocol e.g. will consignments need pre-notification and checks, where consignments will be cleared and whether these facilities will be resourced properly to avoid delays and increased costs.

https://www.theflorist.co.uk/the-florist-magazine-news/2900-half-baked-model-risks-perfect-storm-for-flower-sector-says-industry-body

UKRAINE: AUTHORITIES DISCOVER SCHEME TO SUPLY MILITARY GOODS TO RUSSIA

On 30 July, Interfax Ukraine reported that the Security Service of Ukraine (SBU) officers have found officials of private companies were allegedly involved in organising a mechanism for the illegal supply of military and dual-use goods to Russia, produced by state-owned defence enterprises. It is said that the illegal supply mechanism was blocked by the department in March.

https://en.interfax.com.ua/news/general/677853.html

EXPERTS FEAR THAT NORTH KOREA COULD BE USING THE CORONAVIRUS CRISIS TO SEEK TECHNOLOGY FOR BIOLOGICAL WEAPONS

On 29 July, Newsmax quoted a former Obama Administration official as warning that the DPRK could buy equipment from Western or Chinese sources that would be necessary for their vaccine effort against the coronavirus, and then next year they could turn around and use it to produce biological weapons.

https://www.newsmax.com/newsfront/north-korea-covid-vaccine-biological-weapons/2020/07/29/id/979631/

REPORTS OF SHIPMENTS OF BELARUSIAN AMMUNITION TO USA DISMISSED AS FAKE NEWS

On 30 July, the BELTA news agency reported that Belarus has not shipped ammunition to the US, according to the website of the State Authority for Military Industry of Belarus.  It says that the Russian-speaking Internet mass media Eurasia Daily published an article claiming that Belarus had started exporting ammunition to the US.

https://eng.belta.by/society/view/shipments-of-belarusian-ammunition-to-usa-dismissed-as-fake-news-132134-2020/

INDIAN CUSTOMS DEPARTMENT BUSTS INCENSE STICK SMUGGLING RACKET

Live Mint in India on 30 July reported that smuggling of agarbatti (incense sticks) was placed on the restricted list in 2019 and customs officials have arrested 2 people in Chennai for alleged smuggling of 162 tonnes of agarbattis.  The idea of listing the product was to encourage small domestic producers of incense sticks which will help in job creation.

https://www.livemint.com/news/india/customs-department-busts-agarbatti-smuggling-racket-11596124622784.html

SRI LANKA NAVY HAS DETAINED A SUSPECT WHO WAS SMUGGLING A STOCK OF DRIED TURMERIC 

The Colombo Page on 30 July reported that Customs had interrogated a person who was suspiciously transferring several delivery sacks whilst on patrols stepped up to combat movement s during the covid-19 crisis. The 20 sacks contained dried turmeric which weighed around 1000 kg.

http://www.colombopage.com/archive_20B/Jul30_1596123870CH.php

NINTH CENTURY LORD SHIVA STATUE SMUGGLED INTO UK IN 1998 WILL SOON BE RETURNED TO INDIA

On 30 July, the India Times reported that an ancient statue of Lord Shiva which was stolen from a temple in Rajasthan and smuggled to the UK.  Now, the priceless idol is all set to be returned to its rightful place in India. It was discovered that the statue was brought to the UK where it was found in the collection of a wealthy private collector.

https://www.indiatimes.com/trending/human-interest/stolen-lord-shiva-statue-returned-to-india-from-the-uk-519185.html

https://www.news18.com/news/india/stolen-from-temple-smuggled-to-uk-rare-shiva-statue-from-ninth-century-will-come-home-today-2744185.html

BIRMINGHAM AIRPORT INSPECTORS FIND JUST ONE TYPE OF FOOD IS THE MOST SMUGGLED

The Leamington Observer on 30 July reported that seizures of smuggled food at Birmingham Airport increased by over 10% last year – the food overwhelmingly smuggled into the airport was found to be Betel leaves. The leaves are used in Paan, a chewing mix popular amongst Indians and Bangladeshis, and is a stimulant and mild psychoactive drug – said to be as strong as 6 espresso coffees.

https://leamingtonobserver.co.uk/news/birmingham-airport-inspectors-find-just-one-type-of-food-is-the-most-smuggled-21471/

MALTA PLUMMETS 60 PLACES IN ONE YEAR IN AML INDEX

On 30 July, The Shift reported that Malta has plummeted 60 places in a year in the Basel Institute’s Anti-Money Laundering Index, dropping from its “low-risk” 113th place in 2019 to 53rd place in 2020. It now places Malta as the country with the highest risk within the EU.

https://theshiftnews.com/2020/07/30/malta-plummets-60-places-in-one-year-in-anti-money-laundering-index/

HONG KONG MONETARY AUTHORITY ISSUES AML GUIDANCE TO BANKS AS PANDEMIC PERSISTS

Regulation Asia on 30 July reported that the guidance sets out key practices banks have been using to manage customer due diligence, resource pressure, and emerging threats in the context of Covid-19. It follows a circular in April in which the HKMA encouraged the use of technology to enable remote onboarding and account opening, as a way to meet the challenges of Covid-19.

https://www.regulationasia.com/hkma-issues-aml-guidance-to-banks-as-pandemic-persists/

GIBRALTAR AND BLOCKCHAIN 2020

On 30 July, Isolas published a briefing says that Gibraltar’s regulatory standards and framework for the regulation of virtual asset service providers (VASP) in the fast-paced and dynamic world of distributed ledger technology (DLT) has been central to the success of Gibraltar’s developed DLT industry. It describes the jurisdictions’ DLT regime, considers the implications of the 5th EU AML Directive and FATF requirements. It claims that Gibraltar is 2 years ahead of international regulatory requirements and indeed regulates far beyond what the international community requires.

https://www.gibraltarlawyers.com/news/blockchain-2020-gibraltar-432

US PROSECUTORS EXPANDING CHARGES AGAINST 2 FORMER TWITTER EMPLOYEES AND THEIR ALLEGED SAUDI HANDLER ACCUSED OF SPYING

On 30 July, TRT World reported that prosecutors believe a Saudi citizen linked to the royal family recruited the former Twitter employees to access internal data about users. The pair are accused of having received gifts, including cash payments, for passing on the data an allegedly intermediary between the Twitter employees and Saudi officials.

https://www.trtworld.com/magazine/us-prosecuting-saudis-for-acting-as-agents-money-laundering-and-fraud-38527

EAST AFRICAN HUMAN TRAFFICKING RINGS EXPAND THEIR OPERATIONS

On 30 July, an article in Defence Web reported that the value chain involved in this criminal network comprised 3 links –

  • regionally based recruitment brokers who ferry people from their respective countries to Kenya;
  • Kenyan-based links who ‘receive’ the people and act as the country’s employment agencies. They move victims from Kenya to the host country; and
  • the counterparts who often pose as foreign employment agencies. They are stationed in the host country and ‘receive’ people sent from Kenya.

Most of East Africa’s human trafficking takes place in and through Kenya, with the trafficking of women and girls from East Africa to the Middle East now being carried out entirely by East Africans, and East African networks appear to want control of the entire trafficking value chain.

https://www.defenceweb.co.za/security/border-security/iss-east-african-human-trafficking-rings-expand-their-operations/

BRITON STUART WHITELEY JAILED OVER £4.9 MILLION IRAQI OIL BRIBERY PLOT

On 30 July, the BBC reported on the jailing for 3 years of a British businessman who was involved in a £4.9 million bribery plot to win oil deals in Iraq. He conspired to pay bribes to state-owned firms and politicians after Saddam Hussein was overthrown after the Gulf War in 2003. had previously been convicted of conspiracy to make corrupt payments alongside fellow businessman Ziad Akle. Both men were managers with Monaco-based energy consultancy Unaoil.

https://www.bbc.com/news/uk-england-humber-53588797

NEW JERSEY PUBLIC UNIVERSITY EMPLOYEE ADMITS ROLE IN $5.3 MILLION PRESCRIPTION DRUG SCHEME

A news release from the US DoJ on 29 July advised that John Cuffari, 58, had pleaded guilty by videoconference to an information charging him with conspiracy to commit health care fraud. He admitted his role in a scheme to defraud public and private health benefits programs of at least $5.3 million for the billing of medically unnecessary compounded prescriptions – specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Cuffari was working as a sales representative for several compounding pharmacies.

https://www.justice.gov/usao-nj/pr/new-jersey-public-university-employee-admits-role-53-million-compounded-prescription-drug

SEVENTH CONSPIRATOR PLEADS GUILTY TO PARTICIPATION IN THE DC SOLAR PONZI SCHEME 

A news release from the US DoJ on 28 July advised that Alan Hansen, 49, had pleaded guilty to his participation in a massive fraud scheme through DC Solar, a solar energy company formerly owned and operated by Jeff and Paulette Carpoff, that defrauded investors of approximately $1 billion. Hansen also pleaded guilty to aiding and abetting money laundering.  He is the seventh person to plead guilty to federal criminal charges relating to the fraud scheme since October 2019.  The Carpoffs pleaded guilty to their roles in the fraud conspiracy and other charges in January 2020.

https://www.justice.gov/usao-edca/pr/seventh-conspirator-pleads-guilty-participation-dc-solar-ponzi-scheme-involving-25b

BANK OF SAN ANTONIO SEEKS TO RECOVER $13 MILLION LOST IN ALLEGED PONZI-TYPE FRAUD SCHEME

An article from Rivard Report on 30 July reported that the bank and a subsidiary, Texas Express Funding, are accusing a former top-level employee of forging documents, arranging kickbacks, and swindling the company out of millions of dollars.  The bank alleges the subsidiary’s former president, Wayne Schroeder, fraudulently induced the bank to purchase millions of dollars of worthless accounts receivables from various businesses.

https://therivardreport.com/bank-of-san-antonio-seeks-to-recover-13m-lost-in-alleged-fraud-scheme

SWISS OPEN CRIMINAL PROCEEDINGS INTO FIFA BOSS AND STATE PROSECUTOR

On 30 July, BNN Bloomberg reported that Swiss prosecutors have asked the federal government to strip the immunity of Attorney General Michael Lauber so they can open a criminal investigation against him over a series of undocumented meetings he held with FIFA boss Gianni Infantino. The possible violations include abuse of public office, breach of official secrecy, and the assisting and inciting of offenders.

https://www.bnnbloomberg.ca/swiss-open-criminal-proceedings-into-fifa-boss-own-prosecutor-1.1473148

THE EVOLUTION OF EITI AND NEXT STEPS FOR TACKLING EXTRACTIVE INDUSTRIES CORRUPTION

On 30 July, a post from the Brookings Institute is the last in a series about the launch of a new report into anti-corruption efforts in the natural resources supply chain.  It starts by saying that, since 2002, one of the highest-profile efforts to increase natural resource transparency in resource-rich countries has been the Extractive Industries Transparency Initiative (EITI), a multi-stakeholder initiative consisting of countries, companies, and civil society organisations.  It says that charting the EITI’s evolution and journey through the mechanisms of transparency, accountability, and participation can illustrate the ways in which truly effective natural resource governance can take root. 53 countries are party to EITI (excludes the US, Trump having withdrawn in 2017). While the EITI’s original focus was on transparency in revenue collection, its “Standard” has expanded to cover a wide variety of resource-related data, including contracts with extractive companies, data on resource production, and extractives-related employment numbers. EITI is largely reliant on others —including “infomediaries,” such as journalists and civil society organisations — to translate technical information (which includes all resource-related disclosures) for a general audience. The post says that EITI has achieved successes in producing high-quality open data across the natural resource value chain in implementing countries. Now, it says, it is time to test new strategies by developing country-adapted and evidence-informed strategies to address corruption and to achieve sustainable development goals.

https://www.brookings.edu/blog/up-front/2020/07/30/the-evolution-of-the-eiti-and-next-steps-for-tackling-extractive-industries-corruption

HOW US SANCTIONS DEPEND ON THE FEDERAL RESERVE

An interesting article from the Center for a New American Security on 29 July says that the Federal Reserve (the US central bank body), acts as global lender of last resort, and is successfully shoring up the resilience of the US dollar system, the bedrock of US economic power. It argues that even uniquely powerful national security tools like US financial sanctions are only marginal in their effect on the dollar system and their use appears to cause little harm to US dollar primacy – although concerns about sanctions’ effects on the dollar have reached the highest echelons of government, and the risk that onerous restrictions would encourage China and Europe to find workarounds to avoid reliance on the dollar. The article considers how the Federal reserve reacted to the effects of the covid-19 crisis. It then points out that there are $23 trillion in outstanding dollar-denominated international debt securities and cross-border loans, while about 50% of trade is invoiced in dollars as are around 40% of international payments – saying that as long as international banks and companies borrow and use dollars on this scale, they will follow US sanctions regulations. The article considers that, in the light of experience (and concerns) over re-imposed sanctions on Iran (and non-adherence by other parties, such as the EU) there appear to be 2 lessons –

  • proponents of using economic sanctions for new, far-reaching goals can take comfort and not worry about endangering dollar primacy with their ambitious plans; and
  • opponents of sanctions can still oppose sanctions on the merits, for example by arguing that while “maximum pressure” on Iran may not have ended dollar primacy, it still appears to have failed to achieves its aims while also causing humanitarian damage.

https://www.cnas.org/publications/commentary/how-u-s-sanctions-depend-on-the-federal-reserve

POLITICIANS AND BUSINESS-PEOPLE WHO LIED UNDER OATH AT TRIBUNALS OF INQUIRY GOT AWAY WITH IT BECAUSE THERE IS NO LAW ON PERJURY IN IRELAND

An article in the Irish Times on 30 July reported that examples of false evidence given at tribunals down the decades was raised as the parliament debated legislation on perjury, on course to be passed earlier this year but lapsed because the general election was called.

https://www.irishtimes.com/news/politics/perjury-legislation-aims-to-tackle-insurance-fraud-1.4317604

AIRBUS SUBSIDIARY CHARGED WITH CORRUPTION OVER SAUDI ARABIA CONTRACTS

On 30 July, Breaking News in Ireland reported that the SFO in the UK had charged the former boss of an Airbus subsidiary with corruption over work the company did for the Saudi Arabian military. Jeffrey Cook, the former MD of GPT Special Project Management, is charged over contracts awarded to the company between January 2007 and December 2012 – as well as a separate charge of misconduct in public office over commission he was paid between 2004 and 2008 while working for the MoD. Corruption charges have also been brought against John Mason, the financial officer and part-owner of GPT subcontractors Simec and Duranton, as well as against GPT itself.

https://www.breakingnews.ie/business/airbus-subsidiary-charged-with-corruption-over-saudi-arabia-contracts-1012754.html

CHINA: POLICE ARREST 27 ALLEGED MASTERMINDS BEHIND $5.7 BILLION PLUS TOKEN CRYPTO SCAM

On 30 July, Coindesk reported that 27 primary suspects thought to be responsible for running the massive Plus Token Ponzi scheme were arrested, together with 82 core members of the scheme. The pyramid scheme is said to have grown to over 3,000 layers since last year and fleeced over 2 million people by using cryptocurrencies as a funding channel.

https://www.coindesk.com/police-arrest-27-alleged-masterminds-behind-5-7b-plus-token-crypto-scam

RUSSIA SANCTIONS UPDATE — OVERVIEW AND ENERGY SECTOR FOCUS (INCLUDING EMERGING RUSSIAN COUNTER-SANCTIONS)

On 30 July, US law firm Morgan Lewis published a July update of its April 2020 presentation which highlights the most recent developments and then provides a detailed overview of the relevant frameworks and their possible implications—including a focus on the energy sector (as of 28 July).   The pdf of the slides are made available (89 in all!).

https://www.jdsupra.com/legalnews/us-and-eu-russia-sanctions-update-67129/

RIJOCK

https://rijock.blogspot.com/2020/07/who-in-malta-will-become-collateral.html

GROWING POOL OF DEFENDANTS IN US FOOTBALL BENEFITS FRAUD SCHEME

On 30 July, OCCRP reported that 6 retired players from the American NFL have been charged in a superseding indictment in connection to a scheme to defraud healthcare benefits for former NFL players. The alleged fraud targeted the Gene Upshaw NFL Player Health Reimbursement Account Plan, which provided for tax-free reimbursement of out-of-pocket medical care expenses that were not covered by insurance and that were incurred by former players, their wives and their dependents. The retired players allegedly submitted some $3.9 million in fraudulent claims.

https://www.occrp.org/en/daily/12881-a-growing-pool-of-defendants-in-us-football-benefits-fraud-scheme

MURDER, DRUGS AND EXTORTION IN TUSCANY’S CHINESE UNDERWORLD

A report from OCCRP on 30 July says that much less is known about Italy’s Chinese organised crime groups than the country’s more famous home-grown mafias, with previous research into Chinese organised crime focusing mainly on the Hong Kong triads and their offshoots in London, New York and California. However, it is said that Chinese organised crime has been operating in Italy since the 1990s, smuggling people and trafficking drugs, but Italian law enforcement has struggled to investigate them, with crimes done within the Chinese community, with only a handful of non-Chinese victims out of hundreds of violent acts. However, the report focuses on a new case, and a network based on a Rome-based transport company Euro Anda SRL, with branches run by front men in Paris in France, Neuss in Germany and Madrid and Barcelona in Spain., with the gang being accused of smuggling counterfeit Gucci, Fendi, Prada, and Dolce & Gabbana goods imported from China around Europe.

https://www.occrp.org/en/investigations/murder-drugs-and-extortion-in-tuscanys-chinese-underworld

JERSEY: BUSINESS CRIME Q&A

On 30 July, Appleby published a Q&A article providing a high-level overview of corporate manslaughter, environmental and health and safety issues under Jersey law.

https://www.applebyglobal.com/publications/business-crime-in-jersey-overview/

HMRC FINDS £3 MILLION OF TOBACCO INSIDE ILLEGAL “FACTORY”

On 30 July, the Wisbech Standard carried an article saying that officers from HMRC, assisted by police, seized 9.3 tonnes of tobacco, including 1.2 tonnes of processed tobacco, which was found in a van that was stopped leaving the factory. Machinery involved in the manufacture of tobacco was also dismantled and removed from the property.

https://www.wisbechstandard.co.uk/news/wisbech-illegal-tobacco-factory-raided-by-hmrc-1-6768478

SEC CHARGES SAN ANTONIO-AREA BUSINESSMAN AND COMPANY FOR RUNNING A FRAUDULENT SCHEME WITH SCORES OF INVESTORS, MANY OF THEM RETIRED SAN ANTONIO POLICE OFFICERS AND OTHER FIRST RESPONDERS

A release on Mondo Visione on 30 July advised that the SEC complaint alleges that Victor Lee Farias and his company, Integrity Aviation & Leasing (IAL), raised $14 million from investors, promising that they would use the funds to purchase engines and other aircraft parts for leasing to major airlines.

https://mondovisione.com/media-and-resources/news/sec-charges-ceo-and-company-with-defrauding-first-responders-and-others-out-of-m/

KUWAIT BANS 14 PROMINENT FIGURES FROM TRAVEL OVER CORRUPTION

On 30 July, the Middle East Monitor reported that Kuwait had ordered an immediate travel ban against 14 public figures over “money laundering” charges, with the names of all the suspects sent “to all authorities at land border crossings and airports to ensure they cannot flee”. They include members of the royal family, 2 former ministers and 4 current deputy ministers, and reports say that bank accounts have been frozen.

https://www.middleeastmonitor.com/20200730-kuwait-bans-14-prominent-figures-from-travel-over-corruption/

MEXICO: CRUZ AZUL PRESIDENT ACCUSED OF MONEY LAUNDERING AND INVOLVEMENT IN ORGANISED CRIME

On 30 July, SI.com reported that an arrest warrant has been issued for Cruz Azul president Guillermo Alvarez, 74, general director of the Cruz Azul cement corporation, which runs the Liga MX soccer club.

https://www.si.com/soccer/2020/07/30/cruz-azul-president-accused-money-laundering-organized-crime

MALAYSIA: MAS SETS OUT SUPERVISORY EXPECTATIONS WHERE AML/CFT CONTROL FUNCTIONS ARE OUTSOURCED

On 30 July, a post from Herbert Smith Freehills reported that on 15 July MAS issued a guidance paper which sets out supervisory expectations of sound practices where AML/CFT control functions are outsourced. The briefing provides a summary of the guidance paper’s key learning points, some of which overlap with the updated Outsourcing Principles proposed by IOSCO.

https://hsfnotes.com/fsrandcorpcrime/2020/07/30/mas-sets-out-supervisory-expectations-where-aml-cft-control-functions-are-outsourced/

WHAT DOES SCHREMS II MEAN FOR THE UK?

On 29 July, Lawfare published an article on the outcome of a European court case, the clash between EU privacy law and US surveillance law and rejection of the EU/US Privacy Shield, and what it might mean for the UK post-Brexit.

https://www.lawfareblog.com/what-does-schrems-ii-mean-uk

COVID-19 TRAVEL BANS ARE BOOST FOR “GOLDEN PASSPORT” MARKET

On 30 July, the World Crunch website carried an article from Le Monde claiming that the
super-rich are buying residency papers and passports from places like Cyprus and Vanuatu to be able to travel — despite quarantines — for health reasons, business or pleasure.

https://worldcrunch.com/world-affairs/covid-19-travel-bans-are-boost-for-golden-passport-market

CANADA: HIGH-RANKING HELLS ANGEL HIT WITH NEW CHARGES IN ILLEGAL GAMBLING BUST

On 30 July, The Star reported that high-ranking Hells Angel biker Rob Barletta, 50, from Ontario has been hit with a new wave of money laundering and fraud charges in a crackdown on illegal gambling. He was already awaiting trial after being arrested in December and charged with bookmaking, firearms offences and tax evasion, and was also one of 28 people charged in January in which 228 charges were laid relating to guns, gambling, participating in organized crime and tax evasion.

https://www.thestar.com/news/gta/2020/07/30/high-ranking-hells-angel-hit-with-new-charges-in-illegal-gambling-bust.html

SEC CHARGES FORMER GEORGIA STATE LEGISLATOR WITH DEFRAUDING AT LEAST 100 INVESTORS IN PONZI SCHEME

On 30 July, a release on Mondo Visione advised that SEC alleges that from 2017 to 2019, he fraudulently raised at least $23 million by selling promissory notes to investors – primarily Indian-American professionals – that he guaranteed would provide high annual rates of return – using Allied Energy Services LLC.  In 2019, the alleged scheme collapsed when he failed to make promised interest payments to several investors and then failed to repay the investors’ principal.

https://mondovisione.com/media-and-resources/news/sec-charges-former-georgia-state-legislator-with-defrauding-investors-in-ponzi-s/

UK: CONSULTATION TO UPDATE VICTORIAN-ERA TRANSFER OF OWNERSHIP RULES

On 27 July, the Law Commission announced consultation on draft legislation that would reform and simplify Victorian-era rules on when consumers acquire ownership of goods under sales contracts; and clarify rules used when consumers have ordered goods online or where a retailer goes insolvent before the consumer has received the goods. The consultation closes on 31 October.

https://www.lawcom.gov.uk/project/consumer-sales-contracts-transfer-of-ownership/

MARITIME CRIME DURING THE PANDEMIC: UNMASKING TRENDS IN THE CARIBBEAN

On 30 July, an article from the Center for Maritime Security says that, since the onset of the COVID-19 pandemic the Caribbean’s maritime domain has garnered widespread attention on three fronts: cruise ships stuck at sea, a major increase in US naval presence countering narcotics trafficking (particularly via semi-submersible), and shipments of sanctioned fuels and goods from Iran to Venezuela.  It says that examination of events and trends can bring to light previously overlooked activities and new criminal trends in the region.

http://cimsec.org/maritime-crime-during-the-pandemic-unmasking-trends-in-the-caribbean/45014

CHINA IS GIVING ANCIENT SILK ROAD TRADE ROUTES A DIGITAL MAKEOVER

On 27 July, Global Trade Magazine published an article saying that, in 2015, China launched its Digital Silk Road (DSR) initiative and the article says that the DSR is neither well defined nor understood, but it will re-shape the global economy. The article sets out to tell you what you need to know. The DSR encompasses a vast array of tech projects: building the physical infrastructure for 5G networks, laying fibre optic cable, and constructing and equipping data centres. By design, it also includes promoting China’s standards for telecom, satellite navigation, artificial intelligence, quantum computing, and electronic payment systems throughout the countries where DSR projects are underway. DSR projects combine the hard and soft infrastructure that enable the trade efficiencies promised by this next generation of technology.

https://www.globaltrademag.com/china-is-giving-ancient-silk-road-trade-routes-a-digital-makeover/

 

 

Author: raytodd2017

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

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