Panama Covid-19 update – bit confusing today, as rules change meant (I thought anyway) for tomorrow appear to have started today…so might have been allowed out all day until 9 pm curfew…but still only a “man’s day” regardless, as gender-based controls remain.
Another 2,877 new cases today and 46 new fatalities. There are now 55,932 active cases, with 237 in ICU and 2,440 in other wards.
14 JANUARY 2021
WHISTLEBLOWING SOARS TO RECORD WITH AMERICANS WORKING FROM HOME
On 14 January, KYC 360 reported that the proof is in the data, with SEC receiving 6,900 tips alleging white-collar malfeasance in the fiscal year that ended 30 September, a 31% jump from the previous 12-month record. Intended or not, the SEC has played a big role in encouraging informants to come forward by showing how lucrative whistle-blowing can be. Since the pandemic hit it has paid out some $330 million in awards, including an eye-popping $114 million to a single tipster.
THE FIRST INDEPENDENT REPORT INTO THE SUPPLY CHAIN PRACTICES OF FASHION BRAND BOOHOO
On 14 January, bdaily News reported that the report has detailed the need for the online retailer to clearly set out its plans to ensure practices within its supply chain are legal and ethical. It says it has started the journey and is travelling along the right road but that a full culture change and transparent strategy will be needed to support long term change. The report follows controversy last year when it was revealed that workers at a Leicester factory in its supply chain were being paid £3.50 an hour and were not being offered protection from COVID-19.
OFAC AUTHORISES CERTAIN TRANSACTIONS INVOLVING COMMUNIST CHINESE MILITARY COMPANIES
On 11 January, Cadwalader Cabinet reported that OFAC has authorised certain transactions that involve the publicly traded securities of an entity whose name “closely matches” that of a Communist Chinese military company identified in the Annex of Executive Order, but which has not itself been listed on the non-SDN List, with transactions authorised to 28 January.
UK: SUPREME COURT CHANGES LAW ON WHEN TIME STARTS TO RUN FOR LIMITATION PURPOSES IN A CLAIM TO RECOVER MONEY PAID UNDER A MISTAKE OF LAW
On 12 January, Herbert Smith Freehills published an article about the long-running Franked Investment Income Group Litigation. The Supreme Court has held that, for a claim to recover money paid under a mistake of law, the statutory limitation period begins to run when a claimant could with reasonable diligence have discovered the mistake, in the sense of recognising that it had a “worthwhile claim” – departing from the House of Lords decision in Deutsche Morgan Grenfell Group plc.
US DEPARTMENT OF DEFENSE – TRUSTED CAPITAL DIGITAL MARKETPLACE
On 14 January, Mirage News reported that the DoD has announced the establishment of the Trusted Capital Digital Marketplace (TCDM). It establishes trusted sources of funding for small and medium-sized providers of innovative defence-critical capabilities, offering long-term strategic benefit and combatting predatory investment practices. The article says that SME are vital to the defence industrial base and that funding is paramount to the success of these firms and newly established businesses are susceptible to predatory investment. It is said that adversaries use front companies, joint ventures, mergers and acquisitions, foreign direct investment, and talent recruitment programmes to gain access to and exploit US technology and intellectual property.
HUNDREDS OF UK DEFENCE EXPORT APPLICATIONS HELD UP OVER SAUDI BACKLOG
On 14 January, Shephard Media reported that up to 850 UK defence and security export licence applications have been put on hold as a result of the UK Government attempting to clear a backlog caused by a prior freeze on arms sales to Saudi Arabia between June 2019 and July 2020.
ALLEGED RCMP MOLE ACCUSED OF SELLING SECRETS TO KINGPIN MONEY LAUNDERER AND TERROR-FINANCIER’S NETWORK
On 14 January, Global News in Canada published an article about an RCMP National Intelligence Coordination Centre (NICC) analyst and said that several Canadian intelligence sources with knowledge of the case said RCMP leaders ignored many warning signs, enabling the alleged mole to continue. The existence of the mole was revealed in 2018 after the FBI arrested a man to whom the mole had offered secrets.
NEW ZEALAND: FORMER LAWYER AND ‘ARCHITECT’ OF GANG’S MONEY LAUNDERING SCHEME DENIED PAROLE
On 14 January, the New Zealand Herald reported that Andrew Simpson, 43, a former lawyer described as the “architect” of a scheme laundering millions for the Comancheros gang has been denied parole. He was jailed for over 2 years last year for money laundering.
HOW BELGIAN GOVERNMENT GOT CAUGHT UP IN HUMAN SMUGGLING
On 14 January, EU Observer reported that Melikan Kucam, a member of the Mechelen city council in Belgium for the Flemish nationalist party New Flemish Alliance (NVA), has been sentenced by a court to 8 years in prison for human smuggling. This came after the former Belgian minister Theo Francken gave one of his party friends the power to put Syrian Christians on a list to get Belgian humanitarian visa.
UK: MUTUAL LEGAL ASSISTANCE INFORMATION FOR COMPETENT AUTHORITIES ABROAD (AND IN THE UK)
On 14 January, the Home Office issued updated information about obtaining evidence within the UK (or abroad) to assist in criminal investigations or proceedings. It is updated in the light of the end of the Brexit transition.
UK: PRE-CHARGE BAIL – RESPONSE TO CONSULTATION
On 14 January, the Home Office published the UK Government response to the consultation. It lays out the measures that the Government proposes to take forward, including removal the statutory presumption to release without bail and working with policing stakeholders to ensure there is appropriate guidance to operate the pre-charge bail system; as well as adjusting the timescales and authorisation levels for pre-charge bail to better reflect the operational realities faced by investigating officers, whilst maintaining rigorous oversight of decisions to extend bail timelines.
BAIL REFORMS EXPECTED TO REDUCE NUMBER OF SUSPECTS ‘RELEASED UNDER INVESTIGATION’
The Law Society Gazette reported on 14 January that the Policing and Crime Act 2017 introduced a presumption against using pre-charge bail and a 28-day time limit. However, this led to more people being released under investigation, which has no time limit or conditions. The consultation proposed a new framework for supervising “released under investigation” (RUI) cases. However, the Home Office said it expects RUI numbers to drop significantly under the new reforms.
EU: CONFISCATION OF PROPERTY OF THIRD PARTY IN CONNECTION WITH SMUGGLING OFFENCE
On 14 January, a news release from the Court of Justice of the European Union advised that the CJEU had ruled on a Bulgarian case, saying that a national rule permitting the confiscation of an instrumentality that was used to commit an aggravated smuggling offence but belongs to a third party acting in good faith is contrary to EU law. A national law which permits the confiscation, in the context of criminal proceedings, of property belonging to a person other than the person who committed the criminal offence, without the former being afforded an effective remedy, is contrary to EU law.
ILLICIT TOBACCO TRADE: NEARLY 370 MILLION CIGARETTES SEIZED IN EU IN 2020
EU Reporter on 14 January reported that International operations involving OLAF led to the seizure of nearly 370 million illegal cigarettes in 2020. The majority of the cigarettes were smuggled from countries outside the EU but destined for sale on EU markets. Had they reached the market, OLAF estimates that they would have caused losses of around €74 million in customs and excise duties and VAT.
NISSAN WHISTLEBLOWER GIVES EVIDENCE AT GHOSN TRIAL IN JAPAN
On 14 January, the Digital Journal reported that a whistleblower at Nissan told a Tokyo court he had been instructed to find ways of boosting the retirement benefits of the fugitive former chairman Carlos Ghosn. He was testifying for the first time at the trial of Greg Kelly, who was a top aide of Ghosn when they were both arrested in 2018.
UK: FCA CRYPTO DERIVATIVES BAN MAY PUSH RETAIL INVESTORS TO RISKIER GROUNDS
On 14 January, Coin Telegraph reported that the FCA banning retail investors from engaging with crypto derivatives takes away risk hedging opportunities.
UK: CONSULTATION – INSOLVENCY CHANGES FOR PAYMENT AND ELECTRONIC MONEY INSTITUTIONS (EMI)
On 14 January, HM Treasury issued a reminder about a consultation which closes on 21 January seeking feedback on proposed insolvency changes for payment institutions and EMI, including a new special administration regime.
UK: PUBLIC URGED TO BE VIGILANT AS FRAUDSTERS TARGET ELDERLY AND VULNERABLE WITH FAKE COVID VACCINE
A news release from the NCA on 14 January advised that fraudsters are targeting elderly and vulnerable people with a vaccine scam and asking for bank details or cash payments for access to vaccines that are fake or non-existent.
CRYPTOCURRENCY HACKERS STOLE $3.8 BILLION IN 2020
On 14 January, OCRP reported that cybercriminals stole almost $4 billion in 122 attacks against cryptocurrency platforms and holdings last year, according to a recent report. It is claimed that hackers netting a total of $3.03 billion at an average of $112.12 million per breach. It is also said that the global coronavirus pandemic has seen an explosion in illegal activity online, with the UN warning of an increase in internet-enabled criminality of more than 600% by the middle of last year, at an average rate of 1 attack taking place every 40 seconds.
FREDY NÁJERA, FIXER OF NARCO-POLITICS IN HONDURAS
On 14 January, Insight Crime published an article about former Honduran congressman Fredy Renán Nájera Montoya who, in 2018, still a representative in good standing, was extradited to the US to face drug trafficking and weapons charges. US prosecutors said he secured cocaine shipments in his home base of Olancho, connected Honduras’ main criminal groups and opened the Atlantic trafficking route, one of Central America’s most important. Nájera served in Honduras’ National Congress for the Liberal Party from 2006 until his extradition in March 2018.
EUROPEAN HUMAN RIGHTS COURT ACCEPTS UKRAINE COMPLAINT AGAINST RUSSIA IN CRIMEA
On 14 January, Rferl reported that the ECHR has ruled that a complaint brought by Ukraine against Russia alleging human rights violations in the Crimean Peninsula in 2014 is “partly admissible”.
FinCEN EXTENDS COMMENT PERIOD FOR AML RULE FOR CERTAIN CONVERTIBLE VIRTUAL CURRENCY AND DIGITAL ASSET TRANSACTIONS
On 14 January, a news release from FinCEN advised that it was reopening the comment period for its recent proposed rulemaking regarding certain transactions involving convertible virtual currency (CVC) or digital assets with legal tender status (LTDA). Banks and money services businesses (MSB) would be required to submit reports, keep records, and verify the identity of customers in relation to transactions above certain thresholds involving CVC/LTDA wallets not hosted by a financial institution (also known as “unhosted wallets”) or CVC/LTDA wallets hosted by a financial institution in certain jurisdictions identified by FinCEN.
JAMAICA’S PROGRESS IN STRENGTHENING MEASURES TO TACKLE MONEY LAUNDERING AND TERRORIST FINANCING
On 12 January, CFATF issued a news release saying that, as a result of Jamaica’s progress in strengthening its framework to tackle money laundering and terrorist financing since their 2017 mutual evaluation, the Caribbean Financial Action Task Force (CFATF) has re-rated the country on 19 of the 40 FATF Recommendations. Jamaica has been in an enhanced follow-up process. The news release details the changes made and provides a link to the relevant follow-up report.
OSBORNE CLARKE’S REGULATORY OUTLOOK JANUARY 2021 INCLUDING BREXIT-RELATED
Osborne Clark has released the latest edition of this publication, saying that alongside its usual overview of the current issues and dates for the diary across 17 areas of regulation, includes a special focus on the EU-UK Trade and Cooperation Agreement (TCA). It says that the Regulatory Outlook is intended to be a starting point to understand what this means for a business, whether a UK or EU company trading with the other market or an international business with operations in both territories.
UK: REMINDER OF 3 CONSULTATIONS FROM COMPANIES HOUSE ON PROPOSALS TO COMBAT FRAUD
On 14 January, UK Companies House issued a reminder about 3 consultations launched in December on ways to crack down on fraud and improve corporate transparency – including on ways to improve implementing the ban on corporate directors. The closing date is 3 February.
REGULATING THE ART MARKET IS GOOD FOREIGN POLICY
On 14 January, Foreign Affairs carried an article saying that the recent National Defense Authorization Act included provisions which addressed illicit activity in the antiquities trade. It argues that the $28.3 billion US art market has long evaded regulation. A culture of secrecy, together with rules that allow buyers and sellers to remain anonymous, has allowed criminals to exploit the art market to launder money, evade taxes, and finance terrorism. In July 2020, for example, it was revealed that Russian oligarchs had skirted US sanctions in the aftermath of Russia’s annexation of Crimea by buying more than $18 million in art through shell companies and an intermediary. When the major auction houses ran their due diligence, they investigated the intermediary but never asked whom he was buying for. Then there was the looting of antiquities by ISIS, and the new law brings some welcome accountability to this realm: it subjects the trade in ancient artifacts to the transparency requirements of the Bank Secrecy Act. It says that the US has historically been reluctant to combat antiquities theft, but that events in the early 2000s began drawing public attention to the issue of cultural property, and in 2016 the Senate passed the Protect and Preserve International Cultural Property Act, directing the President to impose import restrictions on cultural property from Syria. The article argues that the US should and could do more, saying that while cleaning up the art market may make it costlier to do business in the art world in the short term, benefits outweigh the drawbacks. It would make the art market less vulnerable to those who would exploit it for criminal purposes, and by strengthening cultural property protections, the new administration can not only weaken terrorists and other criminal organisations but also contribute to rebuilding US friendships abroad.
THE APRIL 2020 ISLAMIC STATE TERROR PLOT AGAINST US AND NATO MILITARY BASES IN GERMANY: THE TAJIK CONNECTION
In the January issue of CTC Sentinel, an article says that an alleged terror plot by a Tajik Islamic State cell to attack US and NATO military bases in Germany, which was thwarted by German police in April 2020, highlights the counterterrorism challenges posed by the radicalisation of a small proportion of Central Asian migrants in Europe. The arrested cell members developed contacts in transnational organized crime and became involved in unusual methods of fundraising, such as bounty hunting and murder-for-hire operations. The case sheds light on the evolving networking between Central Asian and Chechen radical and criminal elements in Europe.
HOW US DoD FIGHTS TO STOP HUMAN TRAFFICKING
On 9 January, Homeland Security Today reported on a little-known US Department of Defense office is working to ensure the fair treatment of workers by employees and contractors in countries all over the world. The Combating Trafficking in Persons (CTIP) program management office is tasked with ensuring that US taxpayer dollars do not contribute to trafficking in persons. In 2006, the DoD established the CTIP program management office with a dedicated program manager. It outlines the roles of the program manager. The CTIP program manager is also charged with issuing the DOD Self-Assessment Report on Combating Trafficking in Persons annually to assess CTIP efforts by the DoD’s various components. The report includes details of violations of the federal laws, rules and regulations on trafficking in persons. In part, annual reporting helps contracting officers hold contractors and subcontractors accountable for abiding by federal acquisition regulations pertaining to combating trafficking in persons.
EU: ADVOCATE GENERAL GIVES GUIDANCE ON COPYRIGHT INFRINGEMENT ON PEER-TO-PEER NETWORKS
On 13 January, an article from Field Fisher says that the EU Court’s Advocate General Szpunar has advised that companies deemed to be “copyright trolls” should not be entitled to the information (e.g. IP addresses) of users sharing copyright-protected content on peer-to-peer networks, in order to collect damages from them for infringement. The Opinion also provided clarity on a much-discussed topic: users who are sharing copyright-protected works on peer-to-peer networks, even if it is only snippets of the works, are carrying out acts of communication to the public. An Advocate General Opinion is not a final decision on the law, that depends on a decision of the Court.
FORMER PETROFAC EXECUTIVE PLEADS GUILTY TO 3 MORE BRIBERY CHARGES
On 14 January, London South-East reported that the SFO said a former Petrofac executive, David Lufkin, Petrofac’s former global head of sales, has pleaded guilty to 3 counts of bribery. The charges related to payments made between 2012 and 2018 to influence the award of contracts to Petrofac in the UAE worth approximately $3.3 billion. The SFO investigation into the activities of Petrofac, its officers, employees and agents for suspected bribery, corruption and money laundering continues. Petrofac Limited is a Jersey-registered provider of oilfield services to the international oil and gas industry.
TEXAS MEGACHURCH PASTOR JAILED FOR 6 YEARS FOR FRAUD
On 14 January, the Daily Mail reported that Kirbyjon H. Caldwell, 67, who was indicted in 2018 was accused of using his influence to persuade people to buy $3.5 million in historical Chinese bonds issued before the communist government took power in 1949. He is a Texas megachurch pastor who once served as a spiritual adviser to Presidents George W. Bush and Barack Obama.
UK: CHECK IF AUTHORISED ECONOMIC OPERATOR (AEO) STATUS COULD BENEFIT YOU
On 14 January, updated information from HMRC is designed for those involved in international trade to find out what types of status they could apply for and the benefits of these. AEO status is an internationally recognised quality mark that shows your business’s role in the international supply chain is secure and has customs control procedures that meet AEO standards and criteria. There are 2 types of status – AEO customs simplification; and AEO security and safety. You can apply for customs simplification or security and safety, or you can apply for both.
BRINGING COMMERCIAL GOODS INTO GREAT BRITAIN IN YOUR BAGGAGE (MERCHANDISE-IN BAGGAGE OR MIB)
On 14 January, updated information from HMRC on what what you need to do when importing commercial goods into Great Britain in your accompanied baggage or small vehicle. It involves commercial goods, aka Merchandise in Baggage, which are goods (to sell or use in your business). You must declare all commercial goods. There is no duty-free allowance for goods you are bringing in to sell or use in your business.
US DoJ RECOVERED OVER $2.2 BILLION FROM FALSE CLAIMS ACT CASES IN FISCAL YEAR 2020
A news release from the DoJ on 14 January advised that the DoJ obtained more than $2.2 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending 30 September 2020. Recoveries since 1986, when Congress substantially strengthened the civil False Claims Act, now total more than $64 billion. Of the FY20 total, $1.8 billion relates to matters that involved the health care industry, including drug and medical device manufacturers, managed care providers, hospitals, pharmacies, hospice organisations, laboratories, and physicians. The False Claims Act serves as the government’s primary civil tool to redress false claims for federal funds and property involving a multitude of government operations and functions. The largest recoveries in the past year came from the drug industry.
MIT PROFESSOR CHARGED WITH HIDING WORK FOR CHINA
On 14 January, Al Jazeera produced a “cheat sheet” about the case involving Gang Chen, 56, a Massachusetts Institute of Technology (MIT) professor arrested and charged with hiding work he did for the Chinese government while he was also receiving US dollars for his nanotechnology research.
US: MICHIGAN MAN INDICTED FOR MULTI-MILLION DOLLAR N95 AND N99 MASK FRAUD
On 14 January, a news release from the DoJ advised the indictment against Rodney L. Stevenson II who is charged with wire fraud, mail fraud, and money laundering for his operation of an e-commerce site that claimed to have N95 masks for sale during the current COVID-19 epidemic. He operated EM General, a Michigan limited liability company created in September 2019, which it is said purported to sell N95 masks with N99 filters, claiming that it had N95 masks “in stock” and available for shipping. EM General sold many of these masks for as much as $24.95 each. The indictment alleges that, as the pandemic worsened and demand for N95 masks increased dramatically, EM General’s sales skyrocketed. According to the indictment, Stevenson and EM General delivered almost none of the masks. Instead, when customers complained and asked for refunds, Stevenson, at times communicating with Gmail accounts he created under the names of fake identities, generally refused to refund customers and instead offered a series of lies to fraudulently prolong his scheme while he continued selling masks.
UN: US DESIGNATION OF HOUTHI MILITIA AS FOREIGN TERRORIST ORGANISATION RISKS EXPEDITING LARGE-SCALE FAMINE IN YEMEN
On 14 January, a news release from the UN advised that speakers during a Security Council videoconference meeting that reviewed the situation in the Middle East nation, scene of what the UN calls the world’s worst humanitarian crisis, warned that the US decision to designate the Houthi militia as a foreign terrorist organisation risks accelerating Yemen’s slide into large-scale famine.
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