Panama Covid-19 update – as we head towards the gradual relaxation of the lockdown and curfew (the gender-based restrictions are due to end on 12 September), some good news with only 7 new fatalities reported today – but which just takes us over the 2,000 level (to 2,002). Mind you, there were 917 new cases repoted, giving a current number of active cases of 24,807 – with 168 (a rise of 11) in ICU, 1,320 (a drop of over 100) in other wards, and 419 in requisitioned hotel rooms.
31 August 2020
INDIA: CHINESE RAN ONLINE BETTING VIA HSBC ACCOUNTS AND ONLINE WALLETS
On 29 August, NDTV reported that the Enforcement Directorate has frozen 4 bank accounts after raiding 15 locations across Delhi, Gurgaon, Mumbai and Pune after some companies were allegedly found running illegal online betting apps linked to China. ED has identified multiple bank accounts mostly held with HSBC Bank. In a statement, it said that during investigation, it is revealed that with the help of some Indian chartered accountants, some Chinese nationals floated multiple Indian companies. Initially, dummy Indian directors were used to incorporate the companies and, after some time, Chinese nationals travelled to India and took directorship in these companies.
HOW PANGOLINS BECAME THE ULTIMATE LUXURY GOOD
On 30 August, The Independent carried an article telling the story of how the trade of pangolin scales became one of the most profitable illegal businesses in Africa is one that unfolds alongside the globalisation of crime and the increased Asian presence in Africa. Pangolin scales are trafficked more like drugs than ivory, it is claimed, at $450 per kg.
SEC TO CONSIDER LIMITING LARGE WHISTLEBLOWER AWARDS
On 28 August, Compliance Week reported that the SEC is to consider controversial changes to its whistleblower program that, if passed, could weaken the agency’s prohibition of retaliation against whistleblowers and limit large rewards. The SEC says the change to the definition of a whistleblower and the protections they are entitled to — which the SEC first proposed in 2018 as a response to a Supreme Court decision — will help it run the programme more efficiently – but critics are concerned by attempts to weaken the prohibition on retaliation.
FCA PROPOSED CHANGES TO AML REPORTING COULD CATCH OUT CRYPTO EXCHANGES
On 28 August, an article from Squire Patton Boggs reported that the FCA announced proposals to extend AML reporting requirements in its financial crime controls to include virtual currency exchanges, such as all cryptoasset exchange providers and custodian wallet providers. The FCA is seeking comments on the proposal by 23 November.
DAMAGES FOR BREACH OF SEPARATE BUT RELATED CONTRACTS
On 27 August, RPC published an article about a Privy Council case from the BVI which found that where parties have entered into separate but related contracts, breach of one contract does not necessarily preclude the recovery of damages under another.
CHAD’S ILLEGAL DRUG TRADE CONTRIBUTES TO REGIONAL INSECURITY
On 25 August, an article from ENACT Africa says that curbing tramadol and other trafficking networks requires transnational cooperation. It says that trafficking must be curbed to prevent entrepreneurs of violence and insecurity (armed gangs, highway robbers, highway criminals and violent extremist groups) in Chad from creating destabilising interdependencies.
Tramadol trafficking routes through Chad to Libya
THE TRADE IN COUNTERFEIT AND CONTRABAND GOODS REMAINS A MAJOR PROBLEM FOR KENYA
On 26 August, an article in ENACT Africa was concerned with the apparent facts that the country needs to do even more to control and prevent counterfeit and other forms of illicit trade. A survey on illicit trade show that production and trade in counterfeits currently cost the country over $900 million annually in tax revenue.
INDIA: CONCERN OVER THE FREEZING OF EXPORTERS’ BANK ACCOUNTS LINKED TO BRAZIL MONEY LAUNDERING CASE
On 31 August, The Wire carried an article saying that the Federation of Indian Export Organisations (FIEO) has expressed concerns over the freezing of bank accounts of some exporters by the Enforcement Directorate (ED) without giving any warning, hearing or reasons. It says that the Government of Brazil had sent a message to the Ministry of External Affairs saying that they are carrying out some investigation against a former Governor and they suspect that about 67 parties in India could be involved in supporting that Governor in money laundering.
EXPERT WARNS BORIS JOHNSON’S “BONKERS” FREE PORT PLAN COULD ‘HURT’ NORTH-EAST ENGLAND
On 31 August, the Press & Journal reported that plans to create a special tax-free zone in the north-east could have a “devastating” impact on the local economy, an accountancy expert has warned, saying that it would create “all sorts of potential risks” – from money laundering to a cut in local authority business rate revenue.
MALTA: PUBLICATION OF FIAU INTERPRETATIVE NOTE FOR LAWYERS
On 29 August, Mamo TCV Advocates published an article saying that the Malta Financial Intelligence Analysis Unit (FIAU) published its ‘Interpretative Note: Relevant Activity for Lawyers’ designed to guide legal professionals in determining the conditions under which a ‘relevant activity’ in terms of Malta’s AML/CFT legislative framework may arise.
The document can be accessed at –
UAE “MAKES SIGNIFICANT PROGRESS IN COMBATING MONEY LAUNDERING AND TERROR FINANCING”
On 31 August, the Emirates News Agency reported that the National Committee for Combating Money Laundering and the Financing of Terrorism and Illegal Organisations (NAMLCFTC) had met to take stock of the significant progress towards fulfilling its role of implementing the national strategic plan for AML/CFT.
UNDERSTANDING THE EU RESPONSE TO ORGANISED CRIME
On 31 August, the EU Parliament Research Service published a briefing paper saying that the EU has made substantial progress in terms of protecting its citizens since the early 1990s, often in response to dramatic incidents, such as mafia or other organised crime group murders, big money laundering scandals, a steep increase in migrant smuggling and trafficking in human beings following the 2015 migration crisis, or – more recently – a sharp rise in cybercrime, fraud and counterfeiting during the coronavirus pandemic. It looks at organised crime in the EU, EU action against it, and the challenges and way forward.
HONG KONG: LIMITED PARTNERSHIP FUND ORDINANCE COMES INTO OPERATION
On 31 August, an article from Eversheds Sutherland reported that close-ended investment funds, particularly private equity and venture capital funds, are expected to be the main beneficiaries of the limited partnership fund (LPF) structure.
EU: VAT HIGHLIGHTS OF THE EUROPEAN COMMISSION’S TAX ACTION PLAN
On 30 August, an article from Baker McKenzie is concerned with the new tax package from the EU in July. The Tax Action Plan is a set of legislative and non-legislative initiatives on taxation that the Commission plans to deliver between 2020 and 2023. The article sets out the VAT highlights that are included in the Tax Action Plan – single EU VAT registrations and extension of the One Stop Shop; Financial Services and Tour Operators Margin Scheme (TOMS); and modernising VAT reporting obligations and cooperation between Member States.
HONG KONG: REGULATORS OBTAINS ARREST WARRANTS ON CHARGE OF CONSPIRACY TO CARRY OUT FALSE TRADING IN THE SHARES
A release on Mondo Visione on 31 August reported that a court has issued arrest warrants for Mr Ho Ming Hin and Mr Simon Suen Man in an application brought by the Securities and Futures Commission (SFC) after they failed to appear in court to face the charge of conspiracy to carry out false trading in the shares of Ching Lee Holdings Limited in 2016.
INDIA: POTENTIAL MISUSE OF ART MARKETS FOR MONEY LAUNDERING
On 31 August, a post from Lex Blog says that as mechanisms for detection and mitigation of money laundering are being improved by the global financial system, criminals are now resorting to trade-based money laundering – i.e. trading commodities in deals that may look unremarkable on the surface, but are in fact undertaken to disguise and leverage illicit money. It says that art has increasingly become a popular commodity to launder money and looks at the implications for the art market in India, and the framework relating to money laundering and the art market in India. It considers lessons from other countries’ art markets. It ends by suggesting measures that may be taken by the intermediaries in the art market.
IRELAND: 2 APPEAR IN SPECIAL CRIMINAL COURT CHARGED WITH 50 MONEY LAUNDERING OFFENCES
On 31 August, Breaking News in Ireland reported that the alleged offences took place 2012-16 involving EBS, Bank of Ireland and AIB accounts.
AUSTRALIA: CROWN RESORTS “DID NOT MONITOR MONEY LAUNDERING ACCOUNTS”
On 31 August, WA Today reported that Crown Resorts’ top legal officer has told a public inquiry that the casino giant’s AML teams did not monitor 2 company bank accounts suspected to have been used to clean dirty cash.
THE TOP 100 CONTAINER PORTS IN THE WORLD
Lloyds List has released its 2020 edition of Lloyd’s List One Hundred Ports, tallying up the annual container throughput figures of the world’s elite port facilities. It says that TEU totals grew by 2.5% in 2019 year on year, against the 4.8% growth figure recorded in 2018 — and the 6% growth posted in 2017. Containerised trade moved through China represented nearly 40% of the overall TEU total.
THE INSIDE STORY OF A $60 MILLION ART FORGERY HOAX
On 28 August, an article in the Guardian says that for 15 years, one of New York’s most prestigious art galleries sold forged paintings – a new film explores how the art world fell for it. At the heart of a scandal was a remarkably homespun, given the status and moneyed anonymity of the fine art world, scheme to pass forgeries off as lost works by masters of abstract expressionism.
ENGINEERED PATHOGENS AND UNNATURAL BIOLOGICAL WEAPONS: THE FUTURE THREAT OF SYNTHETIC BIOLOGY
The August edition of the CTC Sentinel carries this disturbing article says that recent developments in biochemistry, genetics, and molecular biology have made it possible to engineer living organisms. Although these developments offer effective and efficient means with which to cure disease, increase food production, and improve quality of life for many people, they can also be used by state and non-state actors to develop engineered biological weapons. The virtuous circle of bioinformatics, engineering principles, and fundamental biological science also serves as a vicious cycle by lowering the skill-level necessary to produce weapons. The threat of bioengineered agents is all the more clear as the COVID-19 pandemic has demonstrated the enormous impact that a single biological agent, even a naturally occurring one, can have on society. It is likely that terrorist organizations are monitoring these developments closely and that the probability of a biological attack with an engineered agent is steadily increasing.
WHO HAS WHAT MISSILES
The Center for Strategic and International Studies has published updated graphics which display the missile activity and capabilities of countries around the globe, including missile ranges, missile testing patterns, and more. All images are free use with citation to the CSIS Missile Defense Project. It includes Israel, Iran, India, Pakistan and North Korea.
LA FASHION DISTRICT IMPORTER AND COMPANY OWNER AGREE TO PLEAD GUILTY TO CUSTOMS VIOLATIONS AND TAX OFFENCES AND PAY NEARLY $118 MILLION
A news release from US Immigration and Customs Enforcement on 26 August advised that Ambiance Apparel and company owner Sang Bum “Ed” Noh had agreed to plead guilty to felony offences and pay a total of $117,897,708, which includes nearly $36 million in cash seized from Ambiance and Noh in 2014. Ambiance Apparel – the operating name for two corporations, Ambiance USA Inc and Apparel Line USA Inc – agreed to plead guilty to eight counts, including conspiracy, money laundering, and customs offences. It is said that Ambiance imported clothing from Asian countries and submitted fraudulent invoices to US Customs and Border Protection (CBP) that undervalued the shipments and allowed Ambiance to avoid paying the full amount of tariffs owed on the imports.
NUMBER OF TAX TIP OFFS TO HMRC INCREASED 10% LAST YEAR
On 31 August, the Mail reported that the number of whistleblowing reports about potential tax evasion have surged by 10%. Around 73,000 tips were sent online to HMRC in the year to 31 March – up from 66,000 in 2019.
WIRECARD INQUIRY: HOW DID GERMAN OFFICIALS MISS FRAUD OF CENTURY?
On 31 August, Al Jazeera carried an article saying that lawmakers in Germany are questioning an adviser to Chancellor Angela Merkel in Berlin before grilling financial industry watchdogs. A Bundestag committee will also address why German AML authorities didn’t follow up on notifications involving Wirecard. The country’s FIU told the government earlier this month that it’s re-examining more than 1,000 reports of suspicious activity involving Wirecard since June 2017.
BELARUS APPROVES DRAFT CIS MONEY LAUNDERING TREATY
Amidst the ongoing post-election turmoil in the country, on 31 August the Bleta news agency announced that President Aleksandr Lukashenko had signed Decree No. 325 to approve the draft CIS Treaty on Combating Money Laundering, Financing of Terrorism and Financing of Proliferation of Weapons of Mass Destruction as a basis for negotiations.
NORWAY: ØKOKRIM TO PRIORITISE CORONA-FRAUD
On 31 August, Norway Today carried a post saying that the National Authority for Investigation and Prosecution of Economic and Environmental Crime in Norway (Økokrim) will prioritise Corona-related fraud together with the Norwegian Tax Administration and NAV. The agencies responsible for the compensation packages, the Tax Administration and NAV have together with Økokrim attempted to prevent the abuse of the schemes, with some 17,000 applications blocked.
HEAD OF NEW YORK MEDICAL CLINICS SENTENCED FOR MULTIMILLION-DOLLAR MONEY LAUNDERING AND HEALTH CARE KICKBACKS SCHEME
A news release from US DoJ on 31 August advised that Aleksandr Pikus, 45, of New York, was sentenced to 156 months in prison and also ordered to pay $39.4 million in restitution and to forfeit $2,614,233, after he was convicted of conspiracy to commit money laundering, money laundering, and conspiracy to pay and receive health care kickbacks as well obstructing the IRS. It is said that Pikus was the kingpin running a massive money laundering and kickback health care fraud syndicate.
CHINA CUSTOMS DESTROYS 19 TONS OF SMUGGLED DURIANS FRUIT
On 30 August, Produce Report reported that the destroyed durians had not been subjected to the requisite quarantine and approval formalities, nor had the necessary phytosanitary certificates been obtained, thus posing unacceptable food safety and health risks.
UN SECURITY COUNCIL FAILURE TO ADOPT TEXT ON PROSECUTING, REHABILITATING FOREIGN TERRORIST FIGHTERS – US VETO
A news release from the UN on 31 August announced that the Security Council had failed to agree a draft resolution aimed at advancing measures to prosecute, rehabilitate and reintegrate foreign terrorist fighters did not pass owing to a negative vote by the US. The resolution would have repeated calls for continuous implementation of measures regarding prosecution, rehabilitation and reintegration of foreign terrorist fighters, as laid out in previous resolutions.
UN SECURITY COUNCIL RENEWS MALI SANCTIONS
A news release from the UN on 31 August advised that the Security Council had agreed to renew sanctions in Mali for 1 year to 31 August 2021, unanimously adopting a resolution that also extends the work of the expert panel established to focus on the matter. The sanctions include a travel ban and asset freeze on those who are hobbling progress on implementing the Agreement of Peace and Reconciliation in Mali.
UK MAN FACING CHARGES IN US OVER BEC FRAUD
On 31 August, Cyberscoop reported that Habeeb Audu, a dual Nigerian/UK citizen, has been extradited to the US from the UK over alleged money laundering and fraud charges relating to activities 2013-18.
NEW BOOK: THE EVOLUTION OF UN SANCTIONS
Available online, including as an e-book, and marking the 50th anniversary of UN sanctions, this work examines the evolution of sanctions from a primary instrument of economic warfare to a tool of prevention and protection against global conflicts and human rights abuses. It looks at the rise of sanctions as a versatile and frequently used tool to confront the challenges of armed conflicts, terrorism, the proliferation of WMD and violations of international humanitarian and human rights law. It begins with a historical overview of sanctions and the development of the UN system. It then analyses all 30 UN sanctions regimes adopted over the past 50 years. Finally, it sets out to identify possible areas for improvements to the current Security Council structure dominated by the 5 veto-wielding victors of World War 2.