Panama Covid-19 – awful pictures from Chiriqui in the north, from the side effects of Hurricane Eta. I have been unfortunate enough to sit out a hurricane myself whilst in the Bahamas and the damage and loss of life there was less than what the indirect effects have caused here… Apart from the rescuers, Red Cross etc, good to see the big park in the city being used to sort and pack food and essentials for those affected – and this being under Covid, the essentials include alcohol cleanser and boxes of face masks.
Meanwhile, more bad news as new infections exceed 1,000 for the first time since 23 August (1,193 in last 24 hours), 14 fatalities, and even patients in the ICU had risen from 117 to 128. 7,409 tests have been carried out, with a 16.1% positive result and 19,000 active tests.
6 NOVEMBER 2020
SOUTH KOREA: PROBE LAUNCHED INTO ALLEGATIONS AGAINST TOP PROSECUTOR’S WIFE OVER BRIBERY AND STOCK MANIPULATION
On 5 November, the Yonhap News Agency reported a probe into allegations that Prosecutor General Yoon Seok-youl’s wife was involved in bribery and stock manipulation cases.
FBI BULLETIN ON MONEY LAUNDERING BY PRIVATE FUNDS
On 23 October, an article from Schulte Roth & Zabel says that a leaked FBI intelligence bulletin warns that criminals and foreign adversaries may be using hedge funds and private equity funds to launder money, but the article says that reported instances of money laundering through private funds are rare. The article discusses the reasons why the FBI’s concerns may be overstated and the efforts by the private fund industry to prevent money laundering.
EXPORT COMPANIES HAVE TO EXPAND THEIR EXPORT CONTROL SYSTEMS TO INCLUDE THE TRANSFER OF TECHNOLOGY AND SOFTWARE
On 5 November, an article from Blomstein in Germany reported that many companies do not realise is that actions such as uploading construction plans to the cloud or transferring software may fall within the scope of export controls. As a result of this, there are companies that are actually subject to export controls, but are unaware of it and this also means that “traditional” export companies now have to expand their export control systems to include the transfer of technology and software.
HOW CHINA’S NEW EXPORT CONTROL LAW MAY IMPACT YOUR BUSINESS
On 5 November, an article from Baker Donelson was concerned the new law which creates a comprehensive and unified export control regime that regulates the export of goods, technologies and services that impact China’s national security. It applies to the export of dual-use items, military products, nuclear materials and other goods, technologies, services and items that are related to the protection of national security and performance of international obligations. The law will impact any person or entity, in or outside the normal territorial boundaries of China, dealing with the “Controlled Items”. The article provides a number of steps as critical and essential for an effective trade compliance programme under the law. These steps provide a basis and foundation for the compliance programme, but do not constitute an exhaustive list.
CEO OF A $1.2 BILLION SPACE COMPANY CANNOT USE ITS TECHNOLOGY
An article in Quartz on 5 November says that the Russian founder of a business going public in a $1.2 billion transaction is not allowed to work with his own company’s products because of US legal restrictions. Momentus Space was founded in 2017 to develop a “last-mile” transportation system for satellites launched into orbit, using a novel water-based propulsion system and is expected to go public on the NASDAQ in early 2021. Its CEO, Mikhail Kokorich, 44, though credited with a majority of the company’s inventions, is legally barred from accessing the company’s technology. The article says that in 2019 Kokorich was the subject of a federal investigation to determine if he violated export control laws as an investor and executive in several satellite companies. It also said that Kokorich’s controlling interests in the company, or perceptions surrounding an associate, Lev Khasis and his affiliation with Sberbank, could make it more difficult to obtain CFIUS approval in connection with future potential investments by the company in US businesses.
PANAMA BECOMES 56th NATION TO FINALISE OECD MLI CONVENTION
On 5 November, MNE Tax reported that Panama has deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI), and the MLI will enter into force for Panama on 1 March. It will amend Panama’s existing bilateral tax treaties with other countries, adding provisions designed to counter tax avoidance by multinational groups.
UK: FINANCIAL REPORTING COUNCIL ANNOUNCES £500,000 FINE AND REPRIMAND FOR DELOITTE AND FORMER PARTNER FOR AUDIT SHORTCOMINGS
On 6 November, Pensions Age reported that the FRC has issued a final decision notice, imposing sanctions against Deloitte and its former audit engagement partners in relation to a statutory audit of a company’s 2015 financial statements. The breaches related to the audit of the company’s defined benefit pension scheme and the value of the company’s intangible assets.
BEIRUT PORT CUSTOMS CHIEF ARRESTED IN SAUDI DRUG-SMUGGLING CASE
On 6 November, Middle East Monitor reported that Beirut port’s customs chief has been arrested in a drug-smuggling case involving a Saudi Arabian prince. Badri Daher was arrested on suspicion that he accepted bribes, wasted public funds and misused his position, allowing a Saudi prince involved in drug-smuggling to leave Lebanon without paying a multi-million dollar fine. He was already in custody facing allegations that his wilful negligence led to the massive explosion at the port that killed more than 200 people in August.
MALAYSIA: TOBACCO COMPANY LAUDS MOVES TO CURB CIGARETTE SMUGGLING
Free Malaysia Today on 6 November reported that Japan Tobacco International Berhad (JTI Malaysia) has praised the government’s announcement on enhancing efforts to combat the illicit cigarette trade in Malaysia – including the government’s decision to not increase excise tax for cigarettes
US: WOMAN CONVICTED OF SMUGGLING PESTICIDES FROM MEXICO
On 5 November, the Times of San Diego and others reported that Veronica Perez, 40, faces a maximum penalty of 20 years in prison for smuggling 20 containers of an unregistered Mexican pesticide across the border. She is accused of concealing zinc phosphide as she attempted to cross the US-Mexico border in July 2019.
MALTA: LOMBARD BANK TO CONTEST ‘EACH AND EVERY’ FIAU FINDING WHICH LED TO FINE
On 5 November, the Times of Malta reported that Lombard Bank has insisted that a report which led the FIAU to fine it last month ‘in no way suggests the existence of a suspicion nor the presence of money laundering’. FIAU had fined Lombard Bank €340,058 for breaches of AML rules.
EXPECT NO RELAXATION IN AML REGIME, SOLICITORS WARNED
On 6 November, the Law Society Gazette reported that firms can expect no respite from money laundering compliance monitoring, the head of the Law Society’s money laundering task force warned. The Solicitors Regulation Authority has accordingly geared up its risk assessment monitoring and will be continuing visits during lockdown.
SWISS FREEZE MORE THAN $1 BILLION HELD BY TECH MOGUL ROBERT BROCKMAN
On 6 November, the Detroit News reported that Swiss prosecutors froze more than $1 billion held in bank accounts belonging to Houston software tycoon Robert Brockman, who is wanted by the US for alleged tax evasion and money laundering. He was indicted in October by US federal prosecutors for allegedly using a network of secret Caribbean entities to evade taxes on $2 billion in investment income in what may be the largest prosecution of its kind in US history.
MACAU POLICE MAKE SEVERAL ARRESTS TIED TO CASINO MONEY FRAUD
On 6 November, Calvin Ayre reported that, in total, there were reportedly 6 fraud cases that involved money exchange gangs often found working the casino circuit. It says that there is a pattern of using fake bills when it comes to money exchanges in Macau, and another individual is under arrest for the same scam. He reportedly gave his victim $12,900 in practice notes in exchange for the real stuff.
EU PROPOSES SINGLE WINDOW TO MODERNISE CUSTOMS CONTROLS
On 6 November, Sandler Travis Rosenberg reported that the European Commission has proposed a new initiative, the EU Single Window Environment for Customs, that aims to allow traders to electronically submit import and export information just once and make it easier for authorities involved in goods clearance to exchange that information.
RANSOMWARE DEMANDS CONTINUE TO RISE AND REFUSAL TO DELETE STOLEN DATA
A report from Coveware on 4 November says that ransomware groups continue to leverage data exfiltration as a tactic, though trust that stolen data will be deleted is eroding as defaults become more frequent when exfiltrated data is made public despite the victim paying.
CORRUPTION IN NIGERIA: PATTERNS AND TRENDS
In December 2019, the UN Office on Drugs and Crime published this report, being the findings of a second survey on corruption as experienced by the population. The 2019 survey shows a notable increase since 2016, from 52% to 63%, in the overall proportion of Nigerians who had at least one contact with a public official in the 12 months prior to the survey. Nigerian bribe-payers paid an average of 6 bribes in the 12 months prior to the survey, or one bribe every two months, which is virtually the same as the average of 5.8 bribes paid per bribe-payer in 2016. As a result, it is estimated that some 117 million bribes are paid in Nigeria on a yearly basis, the equivalent of 1.1 bribes per adult.
CORRUPTION SCANDALS PLAGUE BRAZIL PRESIDENT’S FAMILY
On 5 November, Insight Crime reported on the problems facing President Bolsonaro’s family following the embezzlement and money laundering charges against Flávio Bolsonaro, the eldest son.
IRISH PORT SECURITY MAY NEED TIGHTENING POST-BREXIT, AND EXTRADITION DELAYS HIGHLIGHTED
On 4 November, RTE in Ireland reported that a senior UK law officer has raised the prospect of international organised crime groups trafficking drugs, people and firearms into the UK via Ireland because of tighter controls at British ports thanks to Brexit – and that Ireland may have to tighten security at its ports accordingly. A House of Commons Committee also heard evidence from the PSNI, NCA and HMRC that a replacement would be needed for the European Arrest Warrant (EAW), which Britain will formally leave on 1 January, as without the EAW, or any replacement mechanism, they would have to rely for cross-border extraditions on a Council of Europe convention dating back to 1956, and with long-winded processes.
SANCTIONED RUSSIAN WEAPONS MAKER KALASHNIKOV: REPORTS OF OWNERSHIP CHANGE
On 6 November, Rferl reported that a former Russian deputy transport minister, Alan Lushnikov, is said to have acquired a controlling stake in weapons maker Kalashnikov – which has been under US sanctions since 2014, and the man Lushnikov acquired his stake, Deputy Defense Minister Aleksei Krivoruchko, was among the high-ranking Russian officials hit with EU sanctions last month over the poisoning of Aleksei Navalny.
AUSTRALIA: FORMER MACQUARRIE FINANCIAL ADVISER CHARGED WITH DISHONESTY OFFENCES
On 6 November, a release from Mondo Visione reported that, following an ASIC investigation, former financial adviser Mr Warren Scott Acworth appeared before Brisbane Magistrates Court charged with 27 serious offences dating from 2015 to 2018.
US: GIFT CARD KING GETS 5 YEARS FOR MONEY LAUNDERING
On 5 November, the Shore News Network reported that Stephen H McIntyre, 51, from Tampa to 5 years and 3 months in federal prison for conspiring to commit money laundering, having pleaded guilty to charges in January. The court also ordered him to forfeit more than $690,000, a 2014 Cadillac Escalade, and other funds that are traceable to the proceeds of the money laundering conspiracy. He operated SHM Gulf Enterprises, LLC (t/a Tampa Gift Card King or GCK), a second-hand dealer where individuals sold their unused, or partially used, returned merchandise cards and retail gift cards, some of which were procured via theft or fraud, for a percentage of the cards’ face value in exchange for cash.
SON OF EX-MAURITANIAN PRESIDENT UNDER INVESTIGATION ON ALLEGED MONEY LAUNDERING CHARGES
On 5 November, The North Africa Post reported that Mauritania’s anti-corruption police department has interrogated Bedr Ould Mohamed Abdel Aziz, son of former President Mohamed Ould Abdel Aziz, on alleged money laundering charges.
SWITZERLAND: GOLD REFINERY THREATENS LEGAL ACTION AGAINST NGO
On 4 November, Swissinfo reported that campaigning NGO Swissaid faces a lawsuit from gold refinery Valcambi after it refused to retract allegations of suspect dealings with a controversial supplier. It says that Valcambi has already lodged a criminal complaint with prosecutors in Bern and has now threatened a civil lawsuit. In September, the Swiss-based Valcambi refinery has rejected accusations about gold dealings with a controversial company in the UAE.
CARDLESS ATM INTRODUCE NEW ACCOUNT TAKEOVER FRAUD AND MONEY LAUNDERING RISKS
On 5 November, Oodaloop reported that a leaked FBI report in July warned the financial services sector about scammers using cardless banking apps to commit account takeover (ATO) fraud and launder money. This also causes new concerns for AML efforts. It says that cybercriminals have exploited “existing mobile device ID security vulnerabilities” in cardless ATM technology “to conduct account takeover and place illicit proceeds into the US banking system”.
FORMER CEO OF BAY AREA MEDICAL DEVICE START-UP SENTENCED TO MORE THAN 11 YEARS IN PRISON FOR FRAUD AND MONEY LAUNDERING
A news release from the US DoJ on 5 November advised that Lawrence J Gerrans, former CEO of a San Rafael-based medical device company, has been sentenced to prison for wire fraud, money laundering, and related charges. From January 12, 2015, through March 16, 2015, Gerrans employed a number of fraudulent methods to siphon funds out of the company. For example, Gerrans systematically transferred more than $2.6 million to himself and 2 shell companies he controlled.
KUWAIT AML DEPARTMENT ISSUES PREVENTIVE MEASURES AGAINST 56 VIOLATING COMPANIES
On 5 November, Asharq Al Aswat reported that the Kuwaiti Anti-Money Laundering and Terrorism Financing Department, which falls under the Ministry of Commerce and Industry, issued 56 preventive measures against violating companies in October – with written warnings to 20 real estate companies, a notice to a money exchange company, 2 others to 2 insurance companies, and 17 to jewellery companies.
CHINA’S BAN ON AUSTRALIAN COAL, SUGAR, BARLEY AND TIMBER
On 6 November, Lloyds List reported that Australian coal, copper ore, barley, timber and sugar are expected to be barred from China from 6 November even if the goods have been paid for and have arrived at port. T his would result in the loss of cargoes for bulker owners.
SEC AMENDS ITS WHISTLEBLOWER PROGRAMME
On 5 November, an article from Cadwalader Cabinet reported that the SEC had amended its whistleblower programme with the goals of providing greater transparency to whistleblowers, properly incentivising whistleblowers and awarding whistleblowers to the “maximum extent appropriate”. It pays eligible whistleblowers an amount equal to not less than 10%, and not more than 30%, of collected monetary sanctions where the whistleblower provides original information to the SEC that leads to a successful enforcement where the amount recovered exceeds $1 million. The relevant final rule will go into effect on 7 December.
5 MILLION ILLEGAL CIGARETTES SEIZED BY CUSTOMS OFFICERS IN NORTHERN IRELAND
On 6 November, the Belfast Newsletter reported that an operation to disrupt the sale and supply of illegal tobacco in County Armagh has uncovered more than 5 million cigarettes, all believed to be illicit.
3 ARRESTED AS POLICE RAIDS FOIL ‘PLAN TO IMPORT VAST QUANTITIES OF COCAINE’ INTO UK
On 6 November, The Scotsman reported that 3 men, including one in Scotland have been charged in the UK and a warehouse has been raided in the Netherlands in connection with an alleged conspiracy to import cocaine through food deliveries. 3 men were arrested in co-ordinated dawn raids that took place in Kent, London and the Glasgow area.
MEMBER STATES AGREE TO EU-LEVEL AML AUTHORITY
On 6 November, OCCRP reported that the EU finance ministers have agreed to set up an AML watchdog with the authority to directly interfere with national jurisdictions if it finds that they have failed to comply. The measures will serve as a basis for a more detailed set of legal proposals that will go into effect in the first quarter of 2021.
I had omitted the following link (as it did not seem to generate much interest!), but it seemed time to add it again and say that, if you would like to make a (polite) gesture and help me with my removal and computer costs, I have a page at https://www.buymeacoffee.com/KoIvM842y