Panama Covid-19 update – it is reported that the sixth nurse has succumbed to Covid-19, as numbers continue to be too high. It seems I personally now know 4 people who have caught the virus – the wife’s aunt, 2 of the men who worked on our apartment and one of the witnesses from my wedding 10 years ago, with only the last being a fatality. Just to add to things, the met office has confirmed that the wet weather is to continue until January… Minsa, the health ministry, reports 12 corrigemento (local districts) with more than 40 new Covid-19 cases, including one with no less than 84 new cases in a 24-hour period on 8 December.
Not so good, either, for the more than 5,000 foreigners deported by the National Migration Service between January and November.
A further 8,286 tests carried out (with a 21.8% hit rate) takes the total of tests to date to over 1 million (i.e. getting on for a quarter of the population), 1,811 new cases, with 23 new fatalities and 22,843 active cases – 170 in ICU, 1,125 in other wards and 666 in hotel rooms.
9 DECEMBER 2020
CANADA – GOVERNMENT HAS INTRODUCED RESTRICTIONS ON THE EXPORT OF CERTAIN DRUGS TO PREVENT SHORTAGES IN LIGHT OF INCREASED DEMAND DUE TO COVID-19
On 28 November, a news release from Health Canada advised drug shortages remain a global challenge and COVID-19 has increased demand for certain drugs, adding to the complexity of ensuring drug supply where it is needed. Canada is a small market, representing 2% of global drug sales, that sources 68% of its drugs internationally. The need for vigilance in maintaining its national drug supply continues, it says. Therefore, drugs intended for the Canadian market are prohibited from being distributed for consumption outside of Canada if that sale would cause or worsen a drug shortage. Companies will also be required to provide information to assess existing or potential shortages, when requested, and within 24 hours if there is a serious or imminent health risk.
PANAMA’S ROLE IN WAR ON DRUGS EARNS PRAISE FROM DEA BOSS
On 9 December, Newsroom Panama reported that a DEA Director had visited Panama complimented the country on its involvement in the fight against illegal drugs. Between January and November, Panamanian security forces have seized around 72 tons of drugs and a total of 90.99 tons of drugs in 2019, the vast majority cocaine, a record for the country, and they arrested 1,013 people linked to drug trafficking, 10% of them foreigners.
PODCAST: FINANCIAL CRIME SCANDALS AND SURPRISES 2020 AND GIVE PREDICTIONS FOR 2021
RUSI has released a podcast which unpacks the financial crime scandals and surprises of 2020 and gives predictions for the year ahead.
COVID-19: IRREGULARITIES IN THE PUBLIC PROCUREMENT SECTOR
On 9 December, the Global initiative on Transnational Organised Crime published an article containing a number of stories from across the world on the issue of irregularities in the public procurement sector. As public contracts for the provision of personal protective equipment (PPE) are being awarded at an unprecedented scale (and speed) to tackle the urgent situation, many governments have suspended their usual funding-accountability and public-procurement rules. While corners have often been cut with the genuine intention of meeting the needs of the population as soon as possible, the health crisis has also provided a perfect opportunity for political elites to game the system in myriad ways.
MUSLIM BROTHERHOOD SUSPECT AND SAUDI BILLIONAIRE “LINKED TO SAME OFFSHORE COMPANIES”
An article from ICIJ on 8 December says that after police raids in Austria last month it is reported that one of 30 people in Austria suspected to be members of the Islamic fundamentalist group Muslim Brotherhood was the director of offshore companies linked to a Saudi billionaire. It is said that the Paradise Papers had revealed the suspected radical, a 37-year-old Viennese entrepreneur with Iraqi roots, was listed as the director of shell companies in the BVI, Malta, and Bahamas. Reporters also found that the shell companies owned properties in the UK, including 2 office buildings, a commercial property and a retail park, worth about $73 million in total. The documents show that a Liechtenstein trust owned by the Saudi businessman was behind those companies. The man is also known as a philanthropist who has financed Islamic studies at various European universities in recent years, including in Austria.
AUSTRALIA: COMMONWEALTH BANK OFFICER CHARGED FOR STEALING $3.75 MILLION
On 8 December, The Age reported that George Vrettakos, a Commonwealth Bank loan officer who allegedly blew $3.75 million in stolen money on cocaine and a lavish lifestyle, has been charged more than a decade after the bank failed to report his suspected crime spree. It is said that the bank quietly sacked Mr Vrettakos and tried to force him to repay the money in 2010.
VITOL: HOW TOP OIL TRADER PAID BRIBES FOR YEARS
On 9 December, KYC 360 carried an article saying that, for years, the world’s largest oil trading firm has maintained that it has “zero tolerance” for corruption. Now Vitol Inc has admitted that it was paying bribes through a network of shell companies and sham contracts. As recently as July 2020, while publicly repeating those assurances, Vitol was bribing government officials in Ecuador and Mexico.
LATIN AMERICAN CRIME CARTELS TURN TO CRYPTO FOR MONEY LAUNDERING
On 8 December, Reuters reported that cryptocurrency is emerging as a new front in Latin America’s struggle against gangs battling for control of vast criminal markets for sex, drugs, guns and people, according to law enforcement authorities. The head of Mexico’s FIU says that the pandemic is accelerating the change. The law requires all registered cryptocurrency trading platforms to report transfers above $2,830. It was passed in 2018 but it took many months to implement the system, and is described as being still a work in progress. However, the amounts involved represent a drop in the ocean compared to organised crime’s hard cash laundry – estimated at $25 billion a year in Mexico alone.
MEXICAN “COOKS” IN SERVICE OF DUTCH GANGS
An article from forbidden Stories on 8 December says that, in the last 2 years, dozens of meth labs have been dismantled in The Netherlands and Belgium and, it is said, 19 Mexican “cooks” have been arrested. It warns that Mexican cartels, the true experts in the production of methamphetamine, could be looking for new opportunities.
UK: NEW COURT ACTION ON ARMS SALES TO SAUDI ARABIA
A news release from the Campaign Against Arms Trade in the UK on 27 October announced that it was to launch a new judicial review action into the legality of the UK decision to renew arms sales to Saudi Arabia. In June 2019, the Court of Appeal banned new arms sales to Saudi Arabia but, after a review, the UK renewed sales to Saudi Arabia in July 2020.
UK COURT OF APPEAL PROVIDES USEFUL REMINDER OF ‘SUBJECT TO CONTRACT’ LABEL MEANING IN SETTLEMENT NEGOTIATIONS
On 8 December, an article from RPC reported that a “Part 36” offer does not alter the status of ‘subject to contract’ protection in solicitors’ correspondence when settling a dispute. It concerned a case involving correspondence marked variously ‘subject to contract’ and ‘without prejudice and subject to contract’. One point made is that a Part 36 offer may be accepted even after the offeree has put forward a different proposal – it is in effect a free-standing offer. The article says that the decision reassures lawyers that they can continue to conduct subject to contract negotiations on behalf of their clients without any undue risk of being bound by what is discussed in the course of those negotiations. The decision also serves as a useful reminder to dispute lawyers of the consent order’s significance in conclusively settling negotiations which are expressed to be subject to contract; the consent order is the contract for these purposes.
HARNESSING CRYPTOCURRENCY TO STRENGTHEN SANCTIONS
On 9 December, an article on War on the Rocks was concerned with how sanctions controls could or should be extended to ensure the use of cryptocurrencies are caught. It says that “adversaries” continue to find new ways to evade sanctions and move money to finance threats to U.S. and international security. Low-technology workarounds like hawala continue to frustrate counter-terror finance efforts. It says that undermine sanctions regimes in much the same way. They allow actors to avoid the formal financial system and escape many of the controls that could detect and disrupt illicit activity. Money can cross jurisdictions undetected and then be used without revealing the true identity of the owner. It warns that sanctioned actors are actively evaluating how cryptocurrency can help them evade sanctions. It gives the example of Venezuela, where taxes on domestic and international flights were collected by a third-party digital wallet app that would process payments, convert them into bitcoin and then transfer the coins to international exchange offices in Hong Kong, Russia, China, and Hungary, where they were converted into US dollars and moved to Venezuelan government accounts. Among other things, the article recommends that the US should continue to work through intergovernmental forums like FATF to advance an international regime of effective controls to ensure sanctioned actors are not able to easily transfer and use cryptocurrencies without oversight. It also says that US law enforcement agencies should increase information on wallets and identifiers of illicit networks.
CUBA ATTRACTS $1.9 BILLION IN FOREIGN INVESTMENT DESPITE US SANCTIONS
On 8 December, Al Jazeera reported that Cuba has said that it had attracted $1.9 bn worth of foreign investment over the past year despite tighter US sanctions. The Trade Minister said that 34 investments approved on the island since October 2019 were no small feat given the “economic war” being waged by the administration of President Trump.
MOLDOVAN ENVOY TO MOSCOW UNDER FIRE OVER DRUG-SMUGGLING SCANDAL
On 8 December, Rferl reported that the Moldovan government is recalling its ambassador to Russia amid a scandal over an alleged attempt to smuggle anabolic steroids to Moscow, saying that Ambassador Andrei Neguta is said to bear responsibility for the “shameful” smuggling attempt. Moldovan authorities say a minibus with diplomatic plates carrying anabolic steroids was stopped on 5 December 5 crossing on the border with Ukraine.
MAJOR NEW SEIZURE OF ILLEGAL CIGARETTES HIGHLIGHTS THE SCALE OF EMERGING EUROPE’S CLANDESTINE TOBACCO TRADE
An article from Emerging Europe reported that law enforcement authorities seized 37 million illegal cigarettes and more than 3,500 litres of illegal fuel last month in a 10-day operation led by Frontex, the European Border and Coast Guard Agency, with the support of Europol. It says that tobacco smuggling causes heavy yearly losses to the budgets of EU countries and the EU institutions in lost customs duties and taxes, and the latest seizures appear to be a drop in the ocean compared with the scale of the illegal tobacco trade. Some estimates place the total loss at over €10 billion per year. Illegal tobacco also poses great risks to consumers and businesses, undermines anti-smoking and public health campaigns and is a significant source of organised crime. It also violates the strict rules that the EU and its member countries have on manufacturing, distribution and sale. The consumption of illegal tobacco is particularly prevalent in the EU’s eastern states, where consumers are attracted to the lower prices offered by cigarette smugglers.
US DOJ EVOLVING FRAMEWORK FOR CRYPTOCURRENCY ENFORCEMENT
On 8 December, an article from Latham & Watkins was concerned with the White paper in October from the US Attorney General’s Cyber-Digital Task Force of the Department of Justice which gives a detailed overview of legitimate uses of cryptocurrencies, the risks of illicit cryptocurrency activity, and related federal enforcement challenges and response strategies. This new paper follows a report in July 2018 on cyber threats. The new paper –
- provides an overview of cryptocurrency technology and the risks and illicit uses of cryptocurrency;
- considers the laws and regulatory agencies that oversee cryptocurrencies and the enforcement tools at their disposal; and
- the ongoing challenges and potential strategies related to illicit uses of cryptocurrency
It is said that the paper is clear that blockchain technology and cryptocurrencies may be transformational innovations, but, as with any technology, parties with malicious intent can use blockchain and cryptocurrencies to circumvent the law and conduct illegal activity.
CARICOM ATTORNEY GENERALS URGE SPECIAL UNIT TO FIGHT EU BLACKLISTING
On 9 December, Barbados Today reported that some Caribbean Community attorney generals have called for greater unity among CARICOM states – possibly spearheaded by a special office – to fight the issue of the blacklisting of their tax jurisdictions by the EU.
INDIA: CHARGE SHEET IN EMBRAER DEFENCE DEAL MONEY LAUNDERING CASE
On 9 December, Newsroom Post reported on a case related to the payment of alleged commission by Brazilian aerospace company Embraer to clinch a $208 million deal with India, in which it is suspected and alleged that kickbacks were paid. It is said that those named on the charge sheet include Embraer SA, Brazil, Interdev Aviation Services Pte Ltd, KRBL Limited, Anoop Kumar Gupta (director of KRBL Limited), Anurag Potdar (nephew of Anoop Kumar Gupta) and others.
NETHERLANDS: UBS CEO RALPH HAMERS DRAWN INTO ING AML PROBE
On 9 December, the Financial News and others reported that the new CEO of UBS, Ralph Hamers, faces a probe into his personal involvement in AML failures during his time at the helm of Dutch bank ING Group. A Dutch court has ordered the public prosecutor to open an investigation into Hamers’ role in the bank’s failure to comply with AML rules.
HONG KONG: POLICE RAID CHURCHES, HOMELESS SHELTERS LINKED TO PROTEST SUPPORT GROUP AND ALLEGE FRAUD AND MONEY LAUNDERING
On 9 December, the Hong Kong Free Press reported that police says that the Hong Kong church behind the “Safeguard Our Generation” campaign, which supported protesters last year, is now under investigation for fraud and money laundering. Raids on 2 premises belonging to the church – as well as homeless shelters it runs – came after HSBC bank accounts were frozen. The church is accused of hiding around HK$18 million of donations received from crowdfunding campaigns.
GUIDANCE FOR BUSINESSES ABOUT HMRC APPROACH TO CIVIL MEASURES TO MONEY LAUNDERING
On 8 December, HMRC published updated guidance intended to raise businesses’ awareness of the steps that HMRC may take when they do not comply with the regulations.
EU COUNTER-TERRORISM AGENDA FOR THE EU
On 9 December, the EU released information on proposals, including more and stronger powers for Europol, improving information exchange and tools for law enforcement.
UK: TIMETABLE SET OUT FOR JUDICIAL REVIEW AND HUMAN RIGHTS ACT REFORM
On 9 December, the Law Society Gazette reported that the Lord Chancellor has revealed the potential timetable for unveiling anticipated judicial review and human rights reforms. The separate reviews are being conducted as part of the Conservative government’s manifesto commitment to examine the broader aspects of the constitution and ‘come up with proposals to restore trust in our institutions and in how our democracy operates’.
UK NATIONAL LEAD FORCE FOR FRAUD
On 9 December, the Home Office published updated information about the National Lead Force (NLF) agreement, under which the City of London Police is the National Lead Force for fraud, including aims and objectives, funding, accountability and governance and performance.
FORMER KYRGYZ PRIME MINISTER ISAKOV GETS NEW TRIAL
On 9 December, The Diplomat reported that former Kyrgyz Prime Minister Sapar Isakov has been granted a retrial in the case of corruption related to the renovation of the State History Museum and the construction of a hippodrome in Cholpon-Ata. However, he was among the imprisoned politicians freed during the unrest after the October parliamentary election, but Isakov never returned to jail.
PROBE INTO THE HEAD OF THE KLIN DISTRICT IN THE MOSCOW REGION OVER POSSIBLE CORRUPTION
On 9 December, Rferl reported that Russia’s Investigative Committee has launched a probe into the head of the Klin district in the Moscow region, Alyona Sokolskaya, following an investigative report by RFE/RL over possible corruption. The August report detailed how her relatives, friends, and acquaintances were allegedly being fictitiously hired at local kindergartens.
US CUSTOMS AND BORDER PROTECTION HAS MODIFIED A WITHHOLD RELEASE ORDER (WRO) ON BONE BLACK FROM BRAZIL
On 9 December, Sandler Travis Rosenberg reported that bone black produced by Bonechar Carvão Ativado do Brasil Ltda is now admissible at all US ports of entry. It had been caught by a WRO which prevented imports of this product from entering the US based on reasonable suspicion that it was produced using forced labour.
JAPAN: NAGASAKI CUSTOMS AUCTION CONFISCATED $600,000 OF GOLD BARS TO RAISE SMUGGLING AWARENESS
On 8 December, The Mainichi reported that some 9.33 kg of pure gold bars and made from confiscated smuggled gold were auctioned by a customs office. In a first anywhere in Japan, Nagasaki Customs put the gold it confiscated from smuggling operations up for general competitive bidding, with the proceeds set to be paid in full to the national treasury.
AT 35 LOCATIONS IN SARAJEVO AND CENTRAL BOSNIA AUTHORITIES DETAINED 14 PEOPLE SUSPECTED OF ORGANISED CRIME, MONEY LAUNDERING, FRAUD AND BUSINESS FRAUD, AS WELL AS ABUSE OF POWER
On 9 December, OCCRP reported that the former Chairman of the Securities Commission of one of Bosnia’s 2 semi-autonomous regions, Hasan Ćelam, the Commission’s ex-associate, Edin Dizdar, as well as a controversial Sarajevo businessman Zijad Blekić, the former head of the Sarajevo Stock Market Supervisory Board and owner of the now-defunct Eurohaus brokerage firm, were among those detained.
SAUDI CUSTOMS SEIZES FAKE CARTRIDGES FOR HP PRINTERS
On 9 December, Trade Arabia reported that Saudi authorities have seized a shipment of counterfeit supplies, which was about to enter the country via a port on the Red Sea Coast. Consequently, around 6,000 ready-for-sale counterfeit toner cartridges were confiscated.
WHY AND HOW ARE COMPLIANCE OFFICERS BRINGING ESG INTO THEIR THIRD-PARTY DUE DILIGENCE PROGRAMMES?
On 9 December, Control Risks published an article posing this question, referring to about environmental, social and governance (ESG) concerns. It says that the growing interest in the compliance space links to increasing public awareness and resulting reputational risk as well as greater checks and balances being put in place by regulatory bodies. It says that more and more clients are starting to take ESG more seriously rather than treat it as ‘soft’ or optional – saying that, after all, this is exactly how the anti-bribery and corruption (ABC) regulatory environment we know today emerged. It offers a few key considerations if a company is wanting to bring ESG into its broader due diligence process. It says that it makes sense to start thinking now about how your organisation will choose to handle ESG concerns. It also makes sense to incorporate them into your existing due diligence process but says that there are some key considerations to be made about if and how you will choose to integrate that into your compliance programme, not least how the different elements of ESG risk can translate differently across a third-party population, and saying that clearly documenting your decision-making process will be vital.
FIRST INTERNATIONAL ORGANISATION TO PROVIDE THE FULL RANGE OF ASSISTANCE AND SUPPORT TO WHISTLEBLOWERS WORLDWIDE LAUNCHED
A release on Mondo Visione on 9 December advised that the first organisation that provides the full range of assistance and support to whistleblowers worldwide has been launched by an international team of attorneys and activists. The Center for Whistleblower Rights & Rewards was announced on UN International Anti-Corruption Day. It is said that, in the absence of competent and independent regulators and law enforcement – particularly in emerging democracies and countries in transition – the Center believes citizens have the power to expose and stop political corruption and financial fraud.
The Center can be found at –
MALTA: AUCTIONEER AND FINANCIAL SERVICES OPERATOR ACCUSED OF LAUNDERING ‘MILLIONS OF EURO’
On 9 December, the Times of Malta reported that an auction firm owner and a financial service practitioner with whom he runs a separate business – Pierre Grech Cumbo Pillow, 44, and Jason Vella Tabone, 37 – were granted bail against a €100,000 bail bond each after pleading not guilty to money laundering charges. Charges were also brought against PGP Trading Limited.
AML NAME SCREENING BEST PRACTICES
On 9 December, Marcos Tinedo published the 4th part of his very useful guidance on name screening for AML compliance and due diligence; with additional clarification on primary indicators.
CLAIM: SWISS TECHNOLOGY USED IN AZERBAIJANI MILITARY DRONES
On 7 December, Swissinfo reported that drones using Swiss-made components were reportedly deployed by the Azerbaijan army in the recent conflict with Armenia. A drive motor cylinder engraved with the name Faulhaber Minimotor SA and the words “Swiss made” can be seen on photographs. Swiss legislation does not prohibit the export of such electric motors from Switzerland to Israel and then on to Azerbaijan, and the drone may have been supplied via Israel.
US IMPORT BAN ON XINJIANG COTTON COULD IMPACT MORE THAN 2,400 CHINESE FIRMS
On 8 December, Sayari reported that it has found some 2,400 companies linked to cotton in Xinjiang based on their business purpose disclosed in official corporate records. An import ban could affect not only these firms but countless manufacturers and distributors in other provinces whose goods rely on cotton from Xinjiang.
HOW THE TOBACCO INDUSTRY’S HEATED-TOBACCO HEALTH OFFENSIVE IS SAPPING STATE REVENUES
On 8 December, OCCRP carried an article saying that manufacturers have been trying to sell purported healthier ways to consume tobacco since the 1990s, when they were forced to admit cigarettes are dangerous after studies proved irrefutably that smoking causes cancer, lung disease, and heart conditions. Developing alternatives would also help avoid the high taxes applied to traditional tobacco products. The duties imposed on tobacco are intended to push up the price of harmful substances like cigarettes and alcohol to make them less attractive for consumers and to raise money to pay for projected healthcare and social costs to the state. The article reports on attempts, and failure, to tax heated-tobacco products (HTP).
CRYPTO TRADER AND ACCUSED PONZI SCHEME IS NOW FIGHTING THE SEC AND JILTED INVESTORS
On 8 December, the Coin Telegraph reported that Crypto Traders Management (CTM) and its former manager Shawn Cutting are in a fight with the SEC. In July, former investors in CTM had filed a civil suit accusing it of selling shares in a sham crypto fund and subsequently refusing to cash those investments out. The investors sought over a million dollars in funds to return as well as penalties.
PODCAST: ASSESSING PROPENSITY FOR BRIBE DEMANDS
In the latest TRACE podcast, Robert Clark, Manager of Legal Research at TRACE, discusses the TRACE Matrix, a data-driven tool that assesses the likelihood — by country — of a company being asked to pay a bribe. This podcast is technical and may be of particular interest to academics and those in civil society seeking new ways to measure risk.
US CUSTOMS SEIZES MORE THAN 100,000 COUNTERFEIT SURGICAL MASKS INTENDED FOR HOSPITAL WORKERS
A news release from US Immigration & Customs Enforcement on 9 December advised that more than 100,000 counterfeit 3M N95 surgical masks destined to be used by hospital workers had been seized ICE, Homeland Security Investigations (HSI) and US Customs and Border Protection (CBP) on 3 December. The masks were in transit at an El Paso bonded warehouse destined to a hospital on the East Coast.
RWANDA: OVER 4,000 PURSUED OVER CORRUPTION IN 2 YEARS
In its 10 December edition, The New Times reported that a total of 4,155 people have since 2018 been investigated over crimes related to corruption, the Secretary General of the Rwanda Investigation Bureau (RIB).
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