OTHER THINGS YOU MAY HAVE MISSED – SEPTEMBER 21

Panama Covid-19 update – numbers continue their quite modest decline, with another 607 new cases today, but still 15 fatalities. There are 22,218 active cases, of which 133 (somewhat fewer) are in ICU, 694 in other wards (much fewer) and 395 in the requisitioned hotel rooms.

21 September 2020

HOW GOLD SMUGGLER REZA ZARRAB SMUGGLED RUSSIA’S MONEY 

On 21 September, KYC 360 reported an OCCRP article which says that a new investigation by OCCRP and Courthouse News Service shows that Russia was central to Zarrab’s money network even before he began working for Iran.  He was the co-owner of Bella Investments Company LLC, a Dubai-based “investment company” that secretly handled around $1.25 billion in suspicious wire transactions involving Russian and offshore entities.   It says that Bella Investments also received payments from offshore companies that have been linked to slave labour in Azerbaijan and petroleum illegally shipped to President Bashar al-Assad’s Syria.

https://www.riskscreen.com/kyc360/news/fincen-files-how-reza-zarrab-smuggled-russias-money-by-suitcase-and-by-wire/

UK: WHY HAS THE SECRETARY OF STATE FOR JUSTICE NOT BEGUN THE REQUIRED REVIEW INTO THE USE OF CLOSED MATERIAL PROCEDURE AND “SECRET” EVIDENCE

On 21 September, an article in the Law Society Gazette posed this question concerning cases in which the court considers that disclosure of sensitive material would damage national security and that a ‘closed material procedure’ would be in the interests of justice. Specially selected security-cleared lawyers – known as “special advocates” – to represent the interests of excluded claimants as best they can. They are ‘not responsible to’ excluded parties and must not speak to them or their lawyers.  This is an alternative to applications for “public interest immunity” (PII), and a way of using classified information in cases without the risk of it being leaked.  The Act that made the change required a review of how closed material procedures operated between June 2013, when it was brought into force, and June 2018 – but to date such a review has not begun.

https://www.lawgazette.co.uk/commentary-and-opinion/lifting-the-lid-on-closed-hearings/5105661.article

SHIPPING IN THE CROSSHAIRS OF US SANCTIONS

On 21 September, an article in Seatrade Maritime News refers to a new series of articles by a law firm which examines how sanctions are applied to the maritime community, saying that sanctions on trade have become a critical component in the toolkit of US foreign policy professionals, with the shipping business, at all levels, increasingly caught in the crosshairs.

https://www.seatrade-maritime.com/opinions-analysis/shipping-crosshairs-us-sanctions

ISLAMIC STATE STILL BRIMS WITH CASH AND AMBITION

On 18 September, the Wall Street Journal reported that Islamic State remains flush with cash despite setbacks in the past year, holding financial reserves and a range of revenue streams that US and Western security officials warn could pay for a dangerous resurgence.  Despite having lost much of its income from oil sales, tax-collection and extortion as well as the local banks it had seized in the so-called caliphate – it still has hundreds of millions of dollars of assets across the Middle East and Central Asia.  This is given that it extorts money from local populations, receives income from businesses it seized during its rule and collects payments from human trafficking.

https://www.wsj.com/articles/islamic-state-defeated-u-s-foe-still-brims-with-cash-ambition-11600464409

https://www.statista.com/chart/18339/countries-ranked-by-peace-level

UK: RELAUNCH OF IMPROVED PUBLIC REGISTER OF CHARITIES

On 17 September, an article from Boodles Hatfield about a “helpful reminder” for those working for and working with charities of the importance of good housekeeping. Whether it is as simple as updating charity contact details or meeting deadlines for annual returns and accounts, all helps contribute to the public perception of a charity.  It links to a news release on 3 September from the Charity Commission about a new public register which makes more information about individual charities available to donors and the public.

https://insights.boodlehatfield.com/post/102gf4f/relaunch-of-improved-public-register-of-charities

https://www.gov.uk/government/news/new-online-register-of-charities-widens-the-publics-window-into-how-charities-are-run

NORTH KOREA AND IRAN RESUME LONG-RANGE MISSILE COOPERATION

On 21 September, the Korea Times reported claims that Iran and North Korea have resumed long-range missile cooperation in a project that includes the transfer of “critical parts,” according to an unnamed senior US official. 

http://www.koreatimes.co.kr/www/nation/2020/09/103_296381.html

NEPAL BANKS AND COMPANIES HELPING CHINA, IRAN SKIRT US SANCTIONS

WIO News carried an article based on the FinCEN Files on 21 September says that some banks and companies in Nepal are allegedly involved in transferring money obtained suspiciously from overseas, with the involvement of Nepali companies and banks attempting to evade US sanctions on trade especially on Iran and China.

https://www.wionews.com/south-asia/nepal-banks-and-companies-helping-china-iran-skirt-us-sanctions-fincen-files-329184

WEAPON SMUGGLERS KILL 5 SUDANESE POLICE OFFICERS

Dabanga on 21 September reported that 5 members of the customs police have been killed during an exchange of fire with weapon smugglers near Debba in Northern State.

https://www.dabangasudan.org/en/all-news/article/weapon-smugglers-kill-five-sudanese-police-officers

IRELAND: REVENUE SEIZE €69,000 WORTH OF SMUGGLED CIGARETTES AT ROSSLARE PORT

The Irish Examiner on 21 September reported that a Hungarian registered vehicle was selected for examination having disembarked a ferry from France. 

https://www.irishexaminer.com/news/arid-40052249.html

AUSTRALIA: MACQUARIE AND CBA BANKS FACE FRESH MONEY LAUNDERING SCRUTINY AFTER THE FinCEN FILES

On 21 September, the Sydney Morning Herald reported that Macquarie Group and Commonwealth Bank are facing fresh scrutiny of their oversight of AML laws after it emerged that overseas banks had reported close to US$167 million of potential dirty money transactions flowing through the 2 Australian banks.

https://www.smh.com.au/business/banking-and-finance/macquarie-cba-face-fresh-money-laundering-scrutiny-after-data-leak-20200921-p55xmg.html

FinCEN FILES LOCAL CONNECTION: LEAKED DOCUMENTS REVEAL POTTERS BAR ADDRESS USED BY MONEY LAUNDERERS TO MOVE MILLIONS

On 21 September, the Welwyn & Hatfield Times reported that a Potters Bar address – Suite 2B on the second floor of 175 Darkes Lane – has been revealed in leaked banking documents to be the home of more than 1,000 UK-registered companies involved in international money laundering.

https://www.whtimes.co.uk/news/potters-bar-address-involved-in-fincen-files-1-6848118

US CUSTOMS SEIZE $2.5 MILLION WORTH OF “SUPER FAKE” ROLEX WATCHES FROM CHINA

On 21 September, Luxury Launches reported that US Customs and Border Protection agents in Cincinnati took over 200 fake Rolexes from a shipment that came from China. The manifest for the shipment described them as “Timer,” and it was intercepted on its way to New York.

PRINCIPLES OF INTERNATIONAL LAW: A BRIEF GUIDE

On 21 September, the House of Commons Library published a briefing paper (in the wake of the Brexit/Internal Market Bill furore), including about the 1969 Vienna Convention on the Law of Treaties (VCLT) sets out the rules relating to the formation, termination, conclusion, interpretation, and validity of treaties. 

NAMIBIA: “FISHROT” WHISTLEBLOWER TO RECEIVE ICELAND AWARD

On 21 September, All Africa reported that Fishrot whistleblower Jóhannes Stefánsson is set to receive an award in Iceland for the work he did in revealing details of Namibia’s biggest corruption scandal.  Stefánsson went to Namibia in 2011 as a representative of the Icelandic seafood company Samherji, to look for business opportunities. He got involved in questionable payments to politicians and businessmen in Namibia and Angola.

https://allafrica.com/stories/202009210809.html

MAURITIUS’ FADING IMAGE OF CLEAN GOVERNANCE

An article in the Daily Maverick on 21 September reported that after Mauritius was placed on the EU potential AML/CFT blacklist, another scandal appeared.  On 8 June the African Development Bank (AfDB) announced that there was evidence that an energy project it had financed in Mauritius executed by Burmeister & Wain Scandinavian Contractor (BWSC) was marred by procurement corruption. The article says that a report from the FATF-style regional body, the Eastern and Southern Africa Anti-Money Laundering Group, in 2019 identified the energy sector as one of the most vulnerable to procurement corruption, and the Mauritius episode backs this finding.

FINLAND TO PROBE TRAFIGURA OVER MONEY LAUNDERING CLAIMS

On 21 September, YLE reported that several reports about Trafigura’s suspected money laundering activities have been filed in the US, and the Finnish Government is said to be planning an investigation into Trafigura, a minority owner in state-owned mining company Terrafame, amid suspicions that it laundered hundreds of millions of euros through tax havens.

https://yle.fi/uutiset/osasto/news/minister_finland_to_probe_trafigura_over_money_laundering_claims/11556280

US REIMPOSES ARMS EXPORT EMBARGO ON IRAN, ADDS 11 INDIVIDUALS AND 2 ENTITIES TO SANCTIONS LISTS AND LISTS PRESIDENT MADURO UNDER IRAN SANCTIONS

On 21 September, OFAC advised that President Trump had signed a new Executive Order “Blocking Property of Certain Persons with Respect to the Conventional Arms Activities of Iran”.  At the same time, it listed an additional 11 individuals and 2 Iran-based entities – MAMMUT DIESEL and MAMMUT INDUSTRIAL GROUP, adding them to its SDN List.  Finally, it amended 9 existing entries on the SDN List, including President Maduro of Venezuela, all of which were of Iran or had links to Iran.

https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20200921

ELECTRONIC SIGNATURES

On 21 September, Field Fisher issued a brief in which the authors consider how care should be taken with the use and acceptance of electronic signatures in the execution of contracts in light of the increased potential for forgery and fraud during the covid-19 pandemic.  It provides some practical tips.

https://www.fieldfisher.com/en/insights/electronic-signatures-virtually-agreed

MEXICO SEIZES SHIP LINKED TO FUEL THEFT

On 21 September, gCaptain reported that Mexican authorities said that they had confiscated a vessel in the Gulf Coast state of Veracruz and a warehouse in neighbouring Tabasco along with storage tanks and trucks used by criminal groups to steal, transport and store hydrocarbons.

US TAXPAYER IN PANAMA PAPERS INVESTIGATION SENTENCED TO PRISON

A news release from the US DoJ on 21 September advised that a former US resident and taxpayer has been sentenced in New York to 4 years in prison for wire fraud, tax fraud, money laundering, false statements, and other charges. Harald Joachim von der Goltz, aka H.J von der Goltz, Johan von der Goltz, Jochen von der Goltz, Tica, and Tika, 83, had been charged along with Ramses Owens, Dirk Brauer, and Richard Gaffey, aka Dick Gaffey, in connection with a decades-long criminal scheme perpetrated by Mossack Fonseca & Co. (Mossack Fonseca), a Panamanian-based global law firm, and its related entities. 

https://www.justice.gov/opa/pr/us-taxpayer-panama-papers-investigation-sentenced-prison

UK NATIONAL SENTENCED TO PRISON FOR ROLE IN “THE DARK OVERLORD” HACKING GROUP

A US DoJ news release on 21 September advised that a UK national – Nathan Wyatt, 39 – pleaded guilty to conspiring to commit aggravated identity theft and computer fraud, and was sentenced to 5 years in federal prison, and also ordered Wyatt to pay $1,467,048 in restitution.  He participated in a computer hacking collective known as “The Dark Overlord,” which targeted victims in the St. Louis area beginning in 2016.  Wyatt was extradited from the UK in December 2019. 

https://www.justice.gov/opa/pr/uk-national-sentenced-prison-role-dark-overlord-hacking-group

SEC ANNOUNCED CHARGES AGAINST A COLORADO MAN FOR DEFRAUDING INVESTORS, INCLUDING CADETS AT THE US AIR FORCE ACADEMY.

On 21 September, a release on Mondo Visione reported that the SEC complaint alleges that over a 2-year period, Milton J. Dosal Jr raised nearly $100,000 from approximately 41 investors under the guise that he would day-trade stocks on their behalf.  It alleges that Dosal used investor funds for personal expenses and diverted new investor funds to pay back prior investors, in a Ponzi-scheme fashion.

https://mondovisione.com/media-and-resources/news/sec-charges-ponzi-scheme-targeting-us-military-service-members/

FinCEN FILES: US TREASURY ABANDONED MAJOR MONEY LAUNDERING CASE AGAINST DUBAI GOLD COMPANY

On 21 September, All Africa reported that, after 3 years investigators in the US had accumulated a mountain of evidence that they believed sealed the case against Dubai-based Kaloti Jewellery Group, one of the largest gold traders and refiners in the world. This had become a key cog in the dirty gold trade, buying the precious metal from sellers suspected of laundering money for drug traffickers and other criminal groups, a DEA-led task force determined. However, it is said that no action was taken and, when attempts to get the UAE to take action, the whole things fizzled out.

https://allafrica.com/stories/202009211089.html

GUERNSEY: CONSULTATION PAPER ON CYBER SECURITY RULES AND GUIDANCE

On 21 September, the Guernsey FSC issued a Consultation Paper seeking views from interested parties on proposed Cyber Security Rules and an accompanying Guidance Note for all licensed entities under the various supervisory laws.  Responses are called for by 2 November.

https://consultationhub.gfsc.gg/banking-and-insurance-supervision-and-policy/cyber-security-rules-and-guidance-consultation-pap/

US REIMPOSES ARMS EXPORT EMBARGO ON IRAN, ADDS 11 INDIVIDUALS AND 2 ENTITIES TO SANCTIONS LISTS AND LISTS PRESIDENT MADURO UNDER IRAN SANCTIONS

On 21 September, OFAC advised that President Trump had signed a new Executive Order “Blocking Property of Certain Persons with Respect to the Conventional Arms Activities of Iran”.  At the same time, it listed an additional 11 individuals and 2 Iran-based entities – MAMMUT DIESEL and MAMMUT INDUSTRIAL GROUP, adding them to its SDN List.  Finally, it amended 9 existing entries on the SDN List, including President Maduro of Venezuela, all of which were of Iran or had links to Iran.

https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20200921

EU AND UK SANCTION 3 COMPANIES AND 2 INDIVIDUALS FOR BREAKING LIBYA ARMS EMBARGO AND HUMAN RIGHTS ABUSES

On 21 September, Arab News reported that the EU has imposed sanctions on 3 companies — 1 Turkish, 1 Kazakh and 1 Jordanian — for breaching the UN arms embargo on Libya.  2 individuals were also made subject with sanctions for supplying material to Libya.  See EU Regulation 2020/1309/EU – Mahmoud Mustafa Busayf al-Warfalli , Commander of Benghazi-based al-Saiqa Brigade; Moussa Diab is said to have engaged in “human trafficking and the kidnapping, raping and killing of migrants and refugees”; Kazakhstan-based Sigma Airlines has been listed after having been identified by the UN as one of the commercial air cargo suppliers acting in non-compliance with the arms embargo; Turkey-based Avrasya Shipping and Lebanon-based Med Wave Shippinghave been designated for operating vessels linked to transports of military material to Libya in May and June 2020. Hm Treasury in the UK issued a Notice following the EU lead on 21 September.

https://www.arabnews.com/node/1737786/world

INDIA: CORONAVIRUS LOCKDOWN CRUSHES GOLD SMUGGLING – ANNUAL ILLEGAL SHIPMENTS TO FALL FROM 120 TONNES TO 25 TONNES

On 21 September, Business Today reported that the coronavirus lockdown in India has significantly hit the inflow of smuggled gold with illegal shipments estimated to have fallen to nearly 2 tonnes a month.  The “normal” nearly 120 tonnes in previous year is about 17% of the country’s annual demand.

https://www.businesstoday.in/current/economy-politics/coronavirus-lockdown-crushes-gold-smuggling-annual-illegal-shipments-likely-to-fall-from-120-tonnes-to-25-tonnes/story/416629.html

ISLE OF MAN: MONEYVAL AML/CFT PROGRESS REPORT

On 21 September, the Isle of Man published a report on progress which has been made in relation to tackling money laundering and combatting the financing of terrorism, following recommendations made by MOEYVAL after an evaluation undertaken in 2016.  It claims that more than £24 million has been recovered since January 2019 – including confiscations in respect of domestic offences; with £17,904,384 identified as being the proceeds of crime and recovered from a local financial institution in partial satisfaction of the foreign confiscation order. 

https://www.gov.im/news/2020/sep/21/report-reflects-isle-of-mans-progress-in-tackling-financial-crime/

AUSTRALIA: STOCKBROKERS THE NEW MONEY LAUNDERING FRONT LINE AS ILLICIT FUNDS TARGET THE ASX

On 20 September, ABC News reported that a proposed change to money laundering laws could flood the stock exchange with dirty cash, experts have warned.  AUSTRAC has closed public consultation on a key rule about identifying the source of funds used to buy and sell ASX stocks, which it is said could inadvertently make it easier for criminals to move money.  Experts in the field are concerned the proposals could make it easier for criminals to launder money by buying and selling shares in traded companies — and then getting their money out.  The proposed changes would mean customers can trade shares and do not have to be identified until 5 days afterwards.

https://www.abc.net.au/news/2020-09-21/stockbrokers-money-laundering-asx-share-market/12678720

CHINA’S UNRELIABLE ENTITIES LIST AND SANCTIONS RISKS FOR FOREIGN BUSINESSES

On 19 September, Deutsche Welle reported that China has announced a sanctions regime Beijing says will “protect the interests” of Chinese companies from “unreliable” foreign companies.  It comes as the rift with the US continues, and with a scheme that somewhat mirrors the US Commerce Department Entity List scheme.  The Unreliable Entities List will contain foreign companies that “harm China’s national sovereignty, security, and development interests” or violate “internationally accepted economic and trade rules”. Penalties for companies the end up on the list include fines, restrictions on importing and exporting and investment, and restrictions on moving employees into China.

https://www.dw.com/en/china-launches-sanctions-scheme-targeting-foreign-firms/a-54985660