On 6 August, law firm Stephenson Harwood hosted a podcast which examines the important topical issues facing the private wealth industry by way of searching interviews with key policy experts, practitioners and thought leaders. In this episode guests discuss the decision of 9 British Overseas Territories to introduce public registers of beneficial ownership of companies and how this will affect rights to privacy.
https://www.shlegal.com/news/capital-talk-the-private-wealth-podcast
A news release from the US DoJ on 6 August announced that the US has filed 2 civil forfeiture complaints in Florida alleging that commercial real estate in Louisville, Kentucky, and Dallas, Texas, were both acquired using funds misappropriated from PrivatBank in Ukraine, and are therefore subject to forfeiture based on violations of federal money laundering statutes. The complaints allege that Ihor Kolomoisky and Gennadiy Boholiubov, who owned PrivatBank, one of the largest banks in Ukraine, embezzled and defrauded the bank of billions of dollars. The complaints allege that they laundered a portion of the criminal proceeds using an array of shell companies’ bank accounts, primarily at PrivatBank’s Cyprus branch, before they transferred the funds to the US. As alleged in the complaint, the loans were rarely repaid except with more fraudulently obtained loan proceeds.
A news release from the US DoJ on 6 August announced that charges have been unsealed against a former official at Citgo Petroleum Corporation, a Houston-based subsidiary of Venezuela’s state-owned and state-controlled energy company Petróleos de Venezuela S.A. (PDVSA). Jose Luis De Jongh Atencio (De Jongh), 48, a dual US-Venezuelan citizen is charged for his alleged role in laundering the proceeds of a scheme involving bribes made to corruptly secure business advantages from Citgo and PDVSA. He is a former procurement officer and manager in Citgo’s Special Projects Group.
A release on Mondo Visione on 6 August advised that, according to the SEC, between 2010 and 2017 the World Acceptance Corporation’s former Mexican subsidiary, WAC de Mexico SA de CV, paid more than $4 million in bribes to Mexican government officials and union officials to secure the ability to make loans to government employees and ensure that those loans were repaid in a timely manner.
On 6 August, a report from OCCRP says that the Inspection Générale des Armées, an independent body that audits the armed forces, found problems with contracts amounting to over $320 million out of the $875 million in military spending it reviewed. The US contributed almost $240 million to Niger’s military budget over the same period. The Inspection Générale’s auditors said more than $137 million had been lost to corruption. It discovered that much of the equipment sourced from international companies – including Russian, Ukrainian, and Chinese state-owned defence companies – was significantly overpriced, not actually delivered, or purchased without going through a competitive bidding process. In addition to cash it provided to Niger’s military, the US spent $280 million building a massive air base which reportedly costs $30 million a year to run, allows US forces to launch drones for both surveillance and air strikes. France and the EU are also major donors to Niger’s military. The report says that at the centre of the network of corruption are 2 Nigerien businessmen who acted as intermediaries in the deals: the well-known arms dealer Aboubacar Hima, and Aboubacar Charfo, a construction contractor with no previous experience in the defence sector. Auditors allege that the men rigged bids by using companies under their control to create the illusion of competition for contracts.
On 6 August, HM Treasury published the annual report for 2018 to 2019 on AML/CFT supervision. HM Treasury has worked with supervisory bodies to develop an annual report on the performance of those supervisors. The report notes improvements in the strength of action taken by statutory supervisors against non-compliance. It says that while the report shows improvements in several areas, across both statutory and the professional body supervisors, there is still more work to do. The supervisors remain committed to further strengthening their approach and tightening the UK’s defences against money laundering.
On 3 August, Accountancy Daily reported that Jersey has begun consulting on secondary legislation regarding the beneficial ownership disclosure provisions of a new law enacted in July and expected to come into force on 1 December.
https://www.step.org/industry-news/jersey-consults-detailed-rules-beneficial-ownership-reporting
On 6 August, the EU Sanctions Blog reported that an SEC filing by the US company has revealed that it has received an administrative subpoena from OFAC to produce information about transactions involving Iran and a subsidiary that it acquired in 2016 from a French company.
On 6 August, OFAC advised that 3 individuals, said to be smugglers contributing to instability in Libya, a Malta-registered company called ALWEFAQ LTD, and a Samoa-flag cargo vessel MARAYA (formerly MED PATRON) – IMO 7514517 had been added to its SDN Lists. It is alleged that Faysal al-Wadi and his associates have smuggled fuel from Libya and used Libya as a transit zone to smuggle illicit drugs.
https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20200806.aspx
The Trade Academy at the International Chamber of Commerce has produced this brief guide on 9 July. It explains that trade finance is the term used to describe the settlement arrangements available to buyers (importers) and sellers (exporters) that are used to mitigate risks and ensure the terms and conditions of an underlying commercial contract are met (i.e. the exporter gets paid and the importer receives the goods or services, both with minimal risk) . A typical trade finance transaction will include the buyer (importer), the seller (exporter) and the banks of the buyer and seller. The “traditional” trade finance solution set can be split into 2 main categories:
The article also considers how Covid-19 has impacted trade finance, saying that the crisis risks further exacerbating longstanding constraints in the trade finance market in a number of strategically important segments from an economic development perspective.
raytodd.blog 