On 15 September, Erick Iván Martelo Robinson,the governor of Guna Yala province had been caught with 79 packets of drugs in his car and he and another man had been arrested. It was later reported that the governor had been fired by the President.
Panama Covid-19 update – there seemed to be even more, and even more noisy, traffic on the roads today, and it felt a little odd to see men and women shopping at the same time…news is that the Rt infection rate is about 0.9, which is good and that so far over 406,000 tests have been carried out (out of total population of 4.3 million, so getting on for 10% of the populace), with 73.8% being negative.
Meanwhile, today another 628 cases reported for 24,010 active cases – with 151 in ICU and 892 in other wards. 14 additional fatalities are reported, taking the total to date to 2,187.
15 September 2020
CAMBODIA’S NEW LAW ON AML
On 10 September, an article from Tilleke & Gibbons explained Cambodia’s new Anti-Money Laundering and Combating the Financing of Terrorism Law which came into force in June 2020. The new Law differs in 3 major ways from the 2007 law: more specific definitions; a requirement for reporting entities to introduce enhanced due diligence measures; and increased penalties for non-compliance.
PREPARING FOR DAC6 AND MANAGING TAX RISK
On 9 September, in an article from MacFarlanes LLP its tax risk experts explain the EU’s new Directive on Administrative Cooperation, and how private equity firms can prepare for compliance and manage tax risk. It says that while DAC6 has been framed as a measure to address potentially aggressive tax planning, it can also catch arrangements with no obvious tax motivation.
UK: NEW POST-BREXIT VAT RULES FOR ONLINE SALES OF GOODS
An article from Baker McKenzie on 13 September said that on 20 July HMRC published new guidance about how VAT will apply to sales of goods in the UK from 1 January. The rules broadly align with the EU proposals for distance sales and imported goods, currently due to come into force from 1 July 2021. Businesses impacted by these changes include overseas sellers of goods to UK customers, all Online Marketplaces which facilitate sales to UK customers and businesses that currently rely on goods being imported VAT-free under the low-value consignment relief (LVCR).
ITALIAN PROSECUTOR SET FOR ‘HISTORIC’ ANTI-MAFIA COURT BATTLE WITH ‘NDRANGHETA
On 12 September, Barron’s reported that anti-mafia prosecutor Nicola Gratteri is gearing up for a “historic” court battle against the country’s powerful ‘Ndrangheta clan, in a case not seen since the days of the “Maxiprocesso” trial against the Sicilian Cosa Nostra in the mid-1980s.
CHINESE SHELL COMPANIES ACCUSED OF HELPING ZTE SELL US TECH TO NORTH KOREA
On 12 September, the South China Morning Post reported that the US has accused 2 Chinese shell companies – Ryer International Trading and Rensy International Trading – of helping China’s technology giant ZTE sell banned telecommunications equipment to North Korea. They are said to have sold the equipment – allegedly made with US parts – to North Korea in 2010-16.
FRENCH REFERENCE TO EUROPEAN COURT OVER ASSETS FROZEN UNDER SANCTIONS LAW
On 15 September, the EU Sanctions Blog reported that the French Cour de Cassation has made a request to the ECJ for a preliminary ruling on questions concerning creditors’ ability to take enforcement action against assets frozen by EU sanctions regulations. The case involves the question of whether or not creditors could claim interest on frozen assets when released.
US COURT DISMISSES FEDEX CLAIM OVER “MORE SCREENING THAN POSSIBLE” OF EXPORTS
On 15 September, the EU Sanctions Blog reported that a federal court had dismissed FedEx’s case was that it is irrational to impose strict liability on common carriers, and that the regulations requires more screening than possible, particularly given the volume of shipments it carries. The court held that it was reasonable that common carriers might be held to a higher standard.
US AND ALLIES AIM TO REVIVE RARE EARTHS INDUSTRY AND END DEPENDENCY ON CHINA
The Financial Times reported that the US and its allies are aiming to revive their rare earth industries to end dependency on China. The US is reliant on China for 17 metallic elements required for high-tech products. The EU is working on a raw materials strategy that aims to end its dependence on China, and Australia has teamed up with the US to source new deposits and support market entrants.
US: EXPORT CONTROLS USED AGAINST NATIONAL SECURITY THREATS
An article from the Atlantic Council says that although trade and economic sanctions are often the go-to regulatory device to address national security and foreign policy objectives, the US has increasingly used export controls for the same purposes. It looks at the use of export controls and the Bureau of Industry and Security Entity List, which imposes additional export licensing controls. It looks at how these weapons have been used in respect of Huawei and the effect of, and costs for, industry that result. It says that this demonstrates the ways in which export controls can be levied — with respect to both particular items and parties — as an effective weapon in furtherance of national security and foreign policy strategies.
IRAN SAYS WELCOMES BARTER OIL TRADE AMID SANCTIONS
On 15 September, Iran Front Page reported that Iranian petroleum minister says Tehran welcomes barter trade in the oil sector and noted agreements have also been concluded to develop jointly-owned oil fields.
MALTA: THE RACE AGAINST TIME TO PLEASE MONEYVAL
On 15 September, The Shift carried an article saying that years of inaction risks Malta’s grey listing which could cost thousands of jobs as well as impact the future of Malta’s lucrative financial services industry. It says that its recent review of penalties published by the FIAU shows that despite its existence since 2002, the FIAU has spent years in almost complete hibernation, with actions taken on very few occasions. From 2015 to 2019 there were no more than 4 enforcement actions a year but, in 2020 (with the threat from MONEYVAL), there have been 18 so far. It also says that, despite reports being passed on to the police to begin criminal action, nothing was done about serious allegations.
SOUTH AFRICA: CHINESE HUMAN TRAFFICKING ACCUSED IN COURT
On 15 September, Defence Web reported that the Johannesburg Magistrates Court granted amendments to bail conditions to one accused and denied bail amendments to 6 accused Chinese nationals arrested for alleged human trafficking and the violation of South Africa’s labour laws.
BREXIT: IMPACT OF THE UK WITHDRAWAL FROM THE EU – EUTM (EU TRADE MARKS) AND RCD (REGISTERED COMMUNITY DESIGN) RIGHTS
On 11 September, the EU Intellectual Property Office published updated information re the end of the Brexit transition period on 31 December.
UK: EXTENDING THE MORATORIUM PERIOD FOR SUSPICIOUS ACTIVITY REPORTS (SAR)
On 15 September, the Home Office published an updated version of 2018 Circular 008/2018. The Circular explained that amendments to POCA 2002 in the Criminal Finances Act 2017 allow “senior officers” of authorised law enforcement agencies to seek an extension to the moratorium period for up to an additional 31 days at a time, up to a maximum of 186 days. The amendment was merely to make a HTML version available.
COUNTER-TERRORISM AND BORDER SECURITY ACT 2019: FACTSHEETS
On 15 September, the Home Office released a number of factsheets about the purpose and operation of this Act. This included one overarching factsheet that explains the general aims of the Act. The new Act makes many changes to existing laws and powers, for example, extending extra-territorial jurisdiction to the offences of inviting or expressing support for a proscribed organisation.
PETROBRAS RESUMES OIL TRADING WITH VITOL, TRAFIGURA AND GLENCORE
An “exclusive” report from Reuters on 15 September says that Brazil’s state-run oil company Petrobras has lifted its ban on trading with major commodity traders Vitol, Trafigura and Glencore, in place since Brazilian prosecutors announced a bribery probe in 2018.
888 AND WILLIAM HILL WILL SURVIVE A NO DEAL BREXIT, GVC & FLUTTER MAYBE NOT
On 15 September, an article from Calvin Ayre makes predictions for post-Brexit gambling companies from the UK.
POST-BREXIT UK SANCTIONS ON AFGHANISTAN
On 15 September, the ECJU etc published this guidance about the sanctions under the Afghanistan (Sanctions) (EU Exit) Regulations 2020, which put in place sanctions measures to ensure the UK continues to meet its obligations under the UN sanctions regime relating to Afghanistan. UN sanctions were initially imposed in 1999, in response to the actions of the Taliban, including providing sanctuary and training for international terrorist groups.
3 MEMBERS OF AN INTERNATIONAL CRIME SYNDICATE WANTED FOR TRICKING AN ITALIAN COMPANY INTO MAKING FRAUDULENT PAYMENTS FOR NON-EXISTENT MEDICAL EQUIPMENT ARRESTED IN INDONESIA
On 15 September, a news release from INTERPOL advised that, in May, an Italian company which was in discussions to purchase a large amount of medical supplies from a Chinese company, including ventilators and COVID-19 monitoring equipment, fell victim to a business email compromise (BEC) fraud – resulting in 3 bank transfers totalling €3.67 million to an account in Indonesia.
US CUSTOMS: 500,000 COUNTERFEIT N95 MASKS SEIZED IN CHICAGO
On 15 September, a news release from US Customs & Border Protection advised that officers in Chicago were contacted by Homeland Security Investigation to seize a shipment arriving from Schenzhen, China. The shipment listed 500,000 N-95 respirator masks, which were believed to be counterfeit.
UK: CONVICTED CONVEYANCER STRUCK OFF FOR FACILITIATING MORTGAGE FRAUD
On 15 September, Legal Futures reported that a conveyancer who recklessly facilitated a mortgage fraud before being convicted of 3 money laundering offences and then failing to surrender to bail has been struck off. It is also reported that, along with his criminal convictions, Stephen Michael Oakley had clocked up 4 previous tribunal appearances for a range of rule breaches. It is said that while the conveyancer did not act dishonestly or in the knowledge that he was facilitating mortgage fraud, he was “reckless in his complete failure to investigate the source of funds”.
HOW DUE DILIGENCE CAN ADDRESS RISKS IN THE DIAMOND INDUSTRY
On 9 September, Kroll published an article saying that brutal, diamond-funded civil wars fought in the 1990s across Angola, Liberia, and Sierra Leone have tarnished the image of a gem historically more associated with fairy tales and royal dynasties; and more recently, in its 2018 List of Goods Produced by Child or Forced Labor, the US Department of Labor identified abusive labour practices in diamond mines across Central and West Africa, and noted that deaths or injuries due to dangerous working conditions remain frequent. In 2003, the UN implemented the Kimberley Process Certification Scheme (the Kimberley Process). The article asks: looking beyond the Kimberley Process: what risks arise from purchasing diamonds? It cautions that Kimberley Process-compliant certification is not a guarantee of ethical practice or sanctions compliance. It also warns that the high value, portability, lack of regulatory framework and traceability, stable and indexed prices are all appealing factors for those tempted to use diamonds in illicit transactions outside of the formal banking system and as a store of value for criminals, terrorists and tax evaders alike. It asks what Are suppliers doing to improve their transparency processes?
UK SHIP REGISTER SHOWCASES NEW LOOK AS IT LAUNCHES ONLINE REGISTRATION
On 15 September, Hellenic Shipping News reported that customers will be invited to use the digital UKSR portal which offers self-serve capability for registering a new vessel and renewing registration. Owners will also be able to provisionally check a vessels name and request transcripts online. It is available for all parts of the register. Commercial and Fishing vessel operators as well as pleasure boat owners and Bareboat Charters will all benefit.
FREIGHT FORWARDERS EXPRESS RESERVATIONS ON BREXIT PREPAREDNESS
On 15 September, Hellenic Shipping News reported that, following a survey of its members, the British International Freight Association (BIFA) reports that a majority of respondents have significant reservations over whether they will have the capacity to handle the major changes to the UK’s trading relationship at the start of 2021, such as new customs documentation and procedures.
POLAND: €900,000 SEIZED IN FORMER MINISTER CORRUPTION PROBE
On 15 September, Polandin.com reported that officers of the Central Anti-corruption Bureau (CBA) seized more than €900,000, reportedly coming from illegal activities of Sławomir Nowak, a former minister in the government of the Civic Platform and Polish People’s Party (PO-PSL) and former head of the Ukrainian State Road Agency. In late July, he was detained under charges of corruption, money laundering and running a criminal group, according to media reports. The investigation is said to be conducted by a joint team of prosecutors from Poland and Ukraine, as well as officers of the CBA and the Ukrainian anti-corruption service NABU.
VISA RESTRICTIONS ON NIGERIANS FOR UNDERMINING THE DEMOCRATIC PROCESS
A news release from the US State Department on 14 September said that in 2019, the US Government said it would consider consequences – including visa restrictions – for individuals responsible for undermining the Nigerian democratic process or for organizing election-related violence. Subsequently, in July 2019, the State Department announced the imposition of visa restrictions on Nigerians who undermined the February and March 2019 elections. It has now imposed additional visa restrictions on individuals for their actions surrounding the November 2019 Kogi and Bayelsa State elections and in the run up to the September and October 2020 Edo and Ondo State elections.
INTERNATIONAL COURT OF JUSTICE: PRELIMINARY OBJECTIONS RAISED BY THE US IN IRAN’S CLAIM THAT RE-IMPOSITION OF SANCTIONS AFTER WITHDRAWAL JCPOA VIOLATES THE 1955 TREATY OF AMITY
On 3 September, the ICJ issued a news release advising of the hearing in which Iran is seeking both an order requiring the US to lift its sanctions, and for compensation. The US has argued that the matter fell outside the 1955 Treaty. The hearing continues through September.
CFIUS FINAL RULE: HOW EXPORT CONTROL REGULATIONS WILL IMPACT MANDATORY FILINGS
An article from Torres Law on 15 September reported that a Final Rules published on 15 September significantly changes the mandatory filings administered by the Committee on Foreign Investment in the United States (CFIUS). Mandatory filings apply to certain controlling and non-controlling foreign investments in US businesses that produce, design, test, manufacture, fabricate, or develop one or more critical technologies, and is said that it focuses more on export control licensing requirements – and the US business may be required to obtain a licence or regulatory authorisation to export to certain persons in the ownership chain. The article identifies the key takeaways to be borne in mind.
SWISS DRAFT COUNTERTERRORISM LAW SETS ‘DANGEROUS PRECEDENT’
On 14 September, Homeland Security Today reports a UN story about claims by several human rights experts that a new draft law which expands the definition of “terrorism” and no longer requires the prospect of any crime at all. The experts warn that expanding the definition of terrorism to any non-violent campaign involving the spreading of fear goes far beyond current Swiss domestic law and violates international standards.
IRANIAN SHIPS CONDUCTED ‘WORLD’S LARGEST ILLEGAL FISHING OPERATIONS’ IN SOMALI AND YEMENI WATERS
On 29 June, the Middle East Eye reported that at least 192 Iranian boats illegally fished in Somalia and Yemen’s territorial waters last year, depleting food supplies in countries where millions are facing acute shortages of food. It is said that the Iranian vessels had been illegally operating in the countries’ territorial waters between January 2019 and April 2020, with the scale of the operation only uncovered after the ships began using a collision-avoidance system that allowed their locations to be susceptible to tracking.
COMMODITY FUTURES TRADING COMMISSION CONSENT ORDER OF PERMANENT INJUNCTION AGAINST EDGE FINANCIAL TECHNOLOGIES LLC OF ILLINOIS FOR AIDING AND ABETTING SPOOFING
A release on Mondo Visione on 15 September reported that the CFTC had entered into a consent order of permanent injunction against Edge Financial Technologies LLC, an Illinois firm that provided software development and computer programming services for traders for the latter having allegedly been involved in providing assistance in spoofing (bidding or offering with the intent to cancel the bid or offer before execution). A permanent court injunction prohibits Edge from providing any computer programming services in connection with trading in CFTC-regulated markets for a period of 2 years, and for it to pay a total of $72,600.
MORE IRANIAN GASOLINE APPEARS HEADED TO VENEZUELA DESPITE US SEIZURES
On 15 September, Hellenic Shipping News reported that Iranian gasoline shipments appears to be headed to Venezuela despite the US government’s move last month to seize similar cargoes. It says that 3 tankers owned by the National Iranian Tanker Company are said to be off South Africa headed for South America.
US PROBE INTO ELECTRIC TRUCK START-UP NIKOLA AFTER CLAIMS COMPANY IS AN ‘INTRICATE FRAUD’ AND MISLED INVESTORS ABOUT HYDROGEN-POWERED TECHNOLOGY
On 15 September, the Mail Online reported that the DoJ has joined a SEC probe into Nikola after report claims company is an ‘intricate fraud’ that has misled investors about hydrogen-powered technology. Federal investigators are examining whether Nikola, which manufactures electric and hydrogen-powered semi-trucks, misrepresented facts about progress it had made in developing the much-touted technology. This development came after a report claims that the truck manufacturer is an ‘intricate fraud’ based on years of lies, exaggerations of its technologies and faked product launches.
TEXAS WOMAN CHARGED WITH FRAUDULENTLY OBTAINING NEARLY $2 MILLION IN COVID RELIEF FUNDS
On 15 September, a news release from the DoJ advised that a Texas woman has been taken into custody on allegations she fraudulently obtained more than $1.9 million in Paycheck Protection Program (PPP) loans. Lola Shalewa Barbara Kasali, 22, of Houston, is charged with making false statements to a financial institution, wire fraud, bank fraud and engaging in unlawful monetary transactions.
SOUTH AFRICA: HAWKS RAID HOMES OF OFFICIALS ALLEGEDLY LINKED TO CORRUPTION
On 15 September, The South African reported that, as part of an ongoing investigation into alleged fraud, corruption and money laundering, the specialist police unit has come down hard on several officials from the eThekwini Municipality Water and Sanitation Unit, as well as, service providers.
EXTRATERRITORIALITY AND JERSEY TRUSTS
An article in ThoughtLeaders4 Private Client Magazine is concerned with, firstly, a recent case in Jersey in which the Royal Court there had to decide whether an asset restraint order under Jersey law could apply to property overseas. In this case, the man at the heart of the case was the settlor and a beneficiary of a discretionary trust governed by Jersey law and its only valuable assets were the shares in a BVI company which, in turn, held a residential property in Singapore. The man was convicted for fraud and money laundering in Indonesia and orders were sought to preserve assets pending the enforcement of financial confiscation orders made in Indonesia. The Royal Court concluded that the restraint order is not limited to property situated in Jersey. A second case involved a judicial review case in which the Royal Court held that the FSC had power to compel a foreign entity to produce documents held in Jersey. The article concludes that trustees may need to be mindful of the same in their administration of trust assets, even where situated outside of Jersey.