Day: September 2, 2020

On 2 September, an article from the Council of Europe says that criminals have been exploiting the upheaval generated by the COVID-19 pandemic by adapting their modus operandi to gain additional profits from various kinds of crimes such as fraud through electronic means, the sale of counterfeit medicines and cybercrime. It says that MONEYVAL has prepared a report outlining preliminary conclusions on threats, vulnerabilities and best practices identified so far during the pandemic based on the information collected from its members. The report aims to assist policymakers, practitioners and the private sector in applying a more targeted and effective response to the emerging money laundering and terrorist financing risks in the European context. The findings indicate that the urgent need to acquire special medical equipment and supplies seems to have created some vulnerabilities for fraud, corruption and subsequent money laundering.  It also says that some findings of the report are also relevant for the general public as a source of information against potential criminal schemes, such as phishing emails, text messages containing links to malicious websites, attachments to obtain personal payment information and social engineering.

https://www.coe.int/en/web/moneyval/-/covid-19-money-laundering-and-terrorism-financing-trends

The report is at –

https://rm.coe.int/moneyval-2020-18rev-covid19/16809f66c3

An article from Orrick Herrington & Sutcliffe LLP on 2 September was concerned with civil forfeiture actions brought by the a US Attorney to seize stolen or laundered virtual currency from various terrorist organizations and North Korean actors. These combined actions represent the largest seizures of cryptocurrency by the US Government to date.  It is said that these cases demonstrate that in its fight against money laundering and terrorist financing, US law enforcement can identify and prosecute terrorist networks that use virtual currency in their attempts to finance their activities through anonymous donations.

https://www.jdsupra.com/legalnews/doj-demonstrates-its-ability-to-track-59432/

On 2 September, OFAC adds Fatou BENSOUDA (aka Fatou Bom BENSOUDA), a Gambian national, and Phakiso MOCHOCHOKO, a Lesotho national, to its SDN Lists.  They are listed pursuant to the Executive Order blocking property of certain persons associated with the International Criminal Court, in response to the ICC assertions of jurisdiction over personnel of the US and certain of its allies, including the ICC Prosecutor’s investigation into actions allegedly committed by US military, intelligence, and other personnel in or relating to Afghanistan.  Bensouda is a chief prosecutor at the ICC.

https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20200902

https://www.france24.com/en/africa/20200902-us-sanctions-icc-chief-prosecutor-bensouda

The Law Commission, which recommends changes and improvements to the law in the UK, has concluded this project.  It says that the 4 Official Secrets Acts that help protect the UK from spying and leaks are outdated and no longer fit for purpose. The criminal law provisions that protect official information are primarily contained in the Official Secrets Acts 1911-1939 and 1989, and the Official Secrets Act 1911 still provides the principal legal protection in the UK against espionage, despite the fact it was enacted in the run up to the First World War. The final report makes 33 recommendations, which notably includes that a statutory public interest defence should be available for anyone – including civilians and journalists – charged with an unauthorised disclosure offence under the Official Secrets Act 1989. If it is found that the disclosure was in the public interest, the defendant would not be guilty of the offence.  It also recommends that public servants and civilians should be able to report concerns of wrongdoing to an independent statutory commissioner who would be tasked with investigating those concerns effectively and efficiently.  Commentator Joshua Rozenberg says that the report makes 33 recommendations in 3 distinct areas:

• Espionage: the criminalisation of individuals who try to obtain sensitive information;
• Leaks: disclosing official information without authorisation; and
• Public interest: when disclosing protected information may be justified.

https://www.lawcom.gov.uk/project/protection-of-official-data/

On 1 September, the OECD reported that a new peer review resulted in an overall Partially Compliant rating, whereas the previous first-round report had concluded the jurisdiction’s EOIR practice to be Largely Compliant with the standard. The main concerns identified refer to the effectiveness of enforcement and supervision activities to ensure the availability of ownership, accounting and banking information, particularly considering the filing compliance rates. Malta also had large number of inactive companies registered during the review period, which caused delays or failures to provide information to its main EOI partners. The new report thus includes recommendations to enhance enforcement, supervision and monitoring activities in order to reduce and limit the number of inactive companies. The ratings show Malta marked down from Largely Compliant to Partially Compliant on access to ownership and identity information and availability of accounting information, and from Compliant to Partially Compliant for availability of banking information and quality and timeliness of information request responses.

https://www.oecd-ilibrary.org/deliver?redirecturl=http%3A%2F%2Fwww.keepeek.com%2FDigital-Asset-Management%2Foecd%2Ftaxation%2Fglobal-forum-on-transparency-and-exchange-of-information-for-tax-purposes-malta-2020-second-round_d92a4f90-en&isPreview=true&itemId=%2Fcontent%2Fpublication%2Fd92a4f90-en

On 2 September, Accountancy Daily reported that the Global Forum on Transparency and Exchange of Information for Tax Purposes has published 9 new peer review reports assessing compliance with the international standard on transparency and exchange of information on request (EOIR) – for Anguilla, Chile, China, Gibraltar, Greece, Korea, Malta, Papua New Guinea and Uruguay.

http://www.oecd.org/tax/exchange-of-tax-information/global-forum-reveals-compliance-ratings-from-new-peer-review-assessments-for-anguilla-chile-china-gibraltar-greece-korea-malta-papua-new-guinea-and-uruguay.htm

On 2 September, Zawya carried a release about a report from SWIFT and BAE Systems Applied Intelligence called ‘Follow the Money’, that describes the complex web of money mules, front companies and cryptocurrencies that criminals use to siphon funds from the financial system after a cyber-attack.

https://www.zawya.com/mena/en/press-releases/story/New_report_reveals_how_cyber_attackers_cash_out_following_largescale_heists-ZAWYA20200902095044/

The report is at –

https://www.swift.com/sites/default/files/files/swift_bae_report_Follow-The%20Money.pdf

 

On 2 September, Fox 26 News in the US reported that US Customs & Border Protection had announced that it had seized $27 million in undeclared cash aboard a ship bound for the US Virgin Islands, the largest such seizure in the region.  It is said to have been aboard a ship docked in Puerto Rico inside home moving boxes destined for St. Thomas.

https://kmph.com/news/instagram/us-agents-seize-record-27m-in-cash-on-ship-bound-for-usvi-09-02-2020

On 1 September, Reuters reported that the Philippines will not halt infrastructure projects involving Chinese companies blacklisted by the US sanction for being involved in building and militarising artificial South China Sea islands, and will act in its own interests, not those of a foreign power, the president’s spokesman said.

https://www.reuters.com/article/us-philippines-china/philippines-says-wont-stop-projects-with-china-firms-blacklisted-by-u-s-idUSKBN25S3Q9