Panama Covid-19 update – It has been revealed that 50 doctors and nurses have died in Panama from Covid-19 during 2020. There have also been 2,128 cases of malaria reported in 2020.
As for the latest Covid-19 statistics, 2,307 new cases today and 34 new fatalities – meaning we are now at 4,689 since March. There are 54,608 active cases, with 233 in ICU, 2,440 in other wards, with another 712 in hotel rooms.
15 JANUARY 2021
CHINESE SMARTPHONE MAKER XIAOMI ON US BLACKLIST
On 15 January, Nikkei Asia reported that Chinese smartphone maker Xiaomi was one of 9 Chinese companies that have been added to a blacklist that will restrict US investment into the company, as the outgoing Trump Administration ratchets up tension by intensifying its crackdown on Chinese corporate interests. It is listed for possible collaboration with the Chinese military. It is said to be the world’s third-largest telephone manufacturer
CHINESE INVESTORS POUR BILLIONS INTO HONG KONG STOCKS ON US BLACKLIST
On 14 January, the Wall Street Journal reported that investors from China have spent billions of dollars buying shares in Hong Kong-listed companies subject to a US government blacklist. They are said to have bought the equivalent of a net $15.8 billion in Hong Kong shares in the first 9 trading days of this year. More than a quarter of the funds went to China Mobile Ltd, the country’s largest telecommunications carrier.
OFAC: COMMUNIST CHINESE MILITARY COMPANIES GENERAL LICENSE 2 AND RELATED FAQ
On 14 January, OFAC advised that it has issued General License No.2 “Authorizing Securities Exchanges Operated by US Persons to Engage in Transactions Involving Securities of Communist Chinese Military Companies”. It has also released 4 related FAQ relating to Executive Order 13959 “Addressing the Threat from Securities Investments that Finance Communist Chinese Military Companies”. At the same time, a new Executive Order “Amending Executive Order 13959 Addressing the Threat from Securities Investments that Finance Communist Chinese Military Companies”.
DISCLOSURE OF INFORMATION RELATING TO JERSEY ENTITIES
On 9 January, an article from Mourant says that the Financial Services (Disclosure and Provision of Information) (Jersey) Law 2020 and some ancillary legislation came into force on 6 January. The Registry Law is amended and provides a new legal framework for entities to disclose certain information to the Jersey FSC, in line with the AML requirements of FATF Recommendation 24. The article says that, in many respects, the Law is a restatement of pre-existing obligations but there are some new concepts and new obligations, and the article provides a table illustrating what is new and what is unchanged, as well as details of other information (including beneficial ownership information) required.
VILLAREJO: THE RISE AND FALL OF THE SPANISH STATE’S SECRET FIXER
On 14 January, an article from the BBC saying that José Manuel Villarejo’s, 69, a former police commissioner, faces the first of what could be a series of criminal trials, as Spanish courts unravel his dealings through more than 25 separate investigations. He has spent the last 3 years on remand in custody, after judicial authorities arrested him in his house near Madrid. They seized his trove of files and secretly recorded conversations, with a cast list of politicians and public figures that reads like a Who’s Who of modern Spain and , since his arrest, leaked excerpts from his tape collection have created a series of scandals – including with Corinna zu Sayn-Wittgenstein, the ex-lover of former Spanish King Juan Carlos. Among the string of criminal investigations is into his involvement in the so-called Operation Kitchen, in which he is accused of heading up an effort to steal documents from a former treasurer of the then-ruling party in Spain, the Popular Party (PP), during the era of former conservative Prime Minister Mariano Rajoy.
US FINAL RULE TO RESCIND SUDAN’S DESIGNATION AS A STATE SPONSOR OF TERRORISM
On 14 January, a news release from the US Commerce Department says that the Bureau of Industry and Security (BIS) has implemented the Secretary of State’s rescission of Sudan as a State Sponsor of Terrorism (SSOT) by amending the Export Administration Regulations (EAR). Aircraft may also be exported or reexported to Sudan without a licence, whereas previously, there was a general policy of denial that limited exports and re-exports of aviation-related items to aircraft parts and components. This action does not alter multilateral or other unilateral export controls, as well as end-user or end-use controls, as specified in the EAR, on items that are destined for Sudan. All licence requirements based upon such controls remain in place for Sudan, as they are for other destinations.
REPORT: BLUEPRINT FOR IDENTIFYING HIGH-RISK OR ILLICIT NUCLEAR TRADE ACTIVITIES AT SCALE.
On 14 January, an article in Homeland Preparedness News reported that a C4ADS and Nuclear Threat Initiative (NTI) report has determined a blueprint for identifying high-risk or illicit nuclear trade activities at scale. It outlines how utilising machine learning techniques analysing commercially available trade data enable analysts to uncover previously unknown companies constituting a nuclear proliferation risk from millions of trade transactions. It is said that illicit trafficking of nuclear materials and technologies around the world—whether by terrorist organisations, rogue states, criminal enterprises, or even unwitting mules—poses a serious threat to global security. The work showed automated data preparation and analysis could save hundreds of analyst hours and identify twice as many potential high-risk entities as previous efforts had through more manual approaches.
US COMMERCE DEPARTMENT REMOVES RUSSIAN TITANIUM PRODUCER VSMPO-AVISMA FROM SANCTIONS LIST
On 15 January, Urdu point reported that the US has removed titanium producer VSMPO-AVISMA the list of companies subject to export control, as a review panel decided its production did not pose a risk of “military end use”. The company, which manufactures parts from titanium and aluminium alloys, has worked with Boeing and Airbus.
US DRONE INDUSTRY: CHANGES IN EXPORT CONTROL COULD HELP U.S. MANUFACTURERS
On 14 January, Drone Life reported that, as the US drone industry continues to develop, new developments in commerce regulations may make it easier for US-based drone manufacturers to access the global marketplace. A change in licensing policy adds flexibility for exports of unmanned aerial systems (UAS) that are controlled for missile technology (MT) reasons, and allows for a more liberal case-by-case review and opens up trade opportunities for some US drone producers.
AFTER SANCTIONS UNCERTAINTY, WORK RESUMES ON NORD STREAM 2
On 15 January, a video report from Deutsche Welle says that work on one of Europe’s most controversial energy projects, the Nord Stream 2 pipeline, is to resume. Originally hailed as a boost to energy security, it has taken centre stage in a row between the US, Russia and Germany.
WHY INDIA, UNLIKE TURKEY, WILL NOT INVITE US SANCTIONS OVER ITS S-400 DEAL WITH RUSSIA?
On 15 January, an article from the Eurasian Times reported that India is going ahead with its plan to induct the Russian S-400 Triumf SAM system. Undeterred by the prospect of the US imposing sanctions under Countering America’s Adversaries Through Sanctions Act (CAATSA), which it has done on Turkey, a NATO member, as well as China. India seems to have taken the calculated risk that given the growing strategic ties between Washington and New Delhi, a trend that will be further strengthened under the incoming Biden Administration, the US will find a way for a waiver of the CAATSA in favour of India.
PAKISTAN: MASSIVE FRAUD AND MONEY LAUNDERING SCAM DETECTED
On 15 January, The News International in Pakistan reported that the Federal Investigative Agency, Karachi has arrested CEO of a software company for harassment, money laundering, forgery and other cybercrimes.
20% OF UK CHEMICALS REGISTRATIONS FACE REVOCATION AFTER BREXIT
On 15 January, EurActiv reported that around 20% of registrations from UK-based companies to the EU REACH chemicals database have not been transferred to EU companies and will be revoked after 31 March, according to the ECHA. As part of Brexit, the UK left the EU chemicals database, REACH, and set up its own version to register and monitor chemicals in Britain. Out of the 2,140 REACH registrants in the UK, 80% had either started or already completed the transfer of their registrations to EU companies by 31 December, the end of the transition period.
US: 2 NUKE PLANTS AND 1 BRIBERY SCANDAL BUT NO ANSWERS
On 15 January, the Daily Mail reported on 2 nuclear plants struggling to compete with natural gas and renewable energy, where the owners of the Ohio plants turned to the government for help, persuading the state’s lawmakers to give them a $1 billion bailout. But relief was short-lived after the financial rescue became entangled in a political bribery scandal that has brought calls to jettison the bailout. The FBI and others are investigating FirstEnergy Corporation’s role in the alleged bribery scheme to secure the bailout.
US: NO TARIFFS ON 3 MORE COUNTRIES IN DIGITAL TAX DISPUTE
On 15 January, Sandler Travis Rosenberg reported that no tariff increases are being imposed on goods from Austria, Spain, or UK after investigations of digital services taxes in those countries. The US previously made similar determinations, and also took no tariff action, with respect to such taxes in India, Italy, and Turkey; and postponed until further notice a tariff increase on imports from France that was to have taken effect on 6 January.
THE WIRE ACT AND ONLINE GAMBLING UNDER THE BIDEN ADMINISTRATION
On 15 January, an Opinion article in Jurist speculates on the possible situation under the new US administration.
EU: REVIEW OF DUAL-USE EXPORT CONTROLS
On 15 January, a briefing paper from the EU Parliament Research Service says that the EU regime has just been revised, mainly to take account of significant technological developments, increase transparency and create a more level playing field among EU Member States. The proposed Regulation will recast the Regulation in force since 2009. Among other elements, the proposal explicitly defines cyber-surveillance technology as dual-use technology and introduces human rights violations as an explicit justification for export control. It also includes provisions to control emerging technologies. The proposed Regulation introduces greater transparency into dual-use export control by increasing the level of detail Member States will have to provide on exports, licences, licence denials and prohibitions.
DOMINICAN TAX AMNESTY, A SCHEME TO LAUNDER MONEY?
On 14 January, an article in Dominican Today was concerned with a tax amnesty which ended on 11 January, and a request for an amendment to the legislation, first proposing that the term be extended for 180 days, later amended to 90 days.
UK: MPs PUT “FAILURE TO PREVENT” ECONOMIC CRIME OFFENCE ON HOLD
An article from Stewarts on 14 January said that the proposed “failure to prevent” amendment to the Financial Services Bill would introduce a new criminal offence holding individuals, corporates, and their directors to account for either facilitating or failing to prevent economic crime. As drafted it would apply to individuals and corporates authorised by or registered with the FCA and would cover fraud, false accounting, any offence under the Proceeds of Crime Act 2002, tax evasion, insider dealing and providing false or misleading financial statements and impressions under the Financial Services Act 2012. However, the vote on the amendment was abandoned, putting further reforms on hold, and the article examines why the amendment is required and whether it is likely to become law.
HEAD OF AZERBAIJAN’S STATE MEDIA FUND ARRESTED AHEAD OF CONTROVERSIAL REFORMS
On 15 January, OC Media reported that Vugar Safarli, the executive director of Azerbaijan’s State Support Fund for Media Development, has been arrested and charged with embezzlement, money laundering, and abuse of office. It is said that the arrest came as Azerbaijan moves to introduce reforms to media regulation in the country that could put greater pressure on journalists. Prosecutors say he misappropriated funds allocated for the construction of flats to be given to journalists in 2013–2019.
GAMBIA MAKES LARGE COCAINE SEIZURE
On 14 January, Insurance Marine News reported that Gambian authorities seized nearly 3 tonnes of cocaine from a shipment of industrial salt that had originated in Ecuador. It was reported to be one of the largest-ever cocaine seizures on the west coast of Africa.
SFO CLOSES BRIBERY PROBE INTO BRITISH AMERICAN TOBACCO
On 15 January, the Financial Times reported that the SFO found insufficient evidence to bring charges against the tobacco company, its subsidiaries or related individuals. The case dates from 2016 and a whistleblower claims, and the SFO opened its investigation in 2017 over alleged bribery in Africa.
UK GOVERNMENT PUBLISHES NATIONAL RISK REGISTER
On 18 December, the UK issued the National Risk Register 2020 which assesses the possibility and potential effects of national security risks that might affect the UK in the next 2 years. It r includes malicious attacks such as cyber-attacks and chemical attacks, as well as societal risks such as serious and organised crime, modern slavery and bribery and corruption.
EUROPEAN PAYMENTS COUNCIL PAYMENT THREATS AND FRAUD TRENDS REPORT
On 6 December, the European Payments Council published this report which identifies social engineering attacks, phishing attacks, malware, advanced persistent threats (APT), (Distributed) Denial of Service (DDoS) attacks, botnets, and monetisation channels, as the most significant threats. The report also puts forward recommendations for payment service providers (PSP) on mitigating the threats identified and includes analysis of threats to payment instruments and payment schemes.
FRANCE: FIU REPORT ON AML/CFT RISK TRENDS
On 10 December, the French FIU published a report (in French) on risk trends from 2019-20, noting that construction, public works, and trading and distribution sectors are among the most vulnerable, while the main predicate offences were tax avoidance and tax evasion. The FIU underlines that a harmonised EU-level framework would be the best solution to tackle these money laundering/terrorist financing crimes when committed using electronic money or virtual assets; and prohibition of anonymous electronic money, anonymous accounts and cryptoassets, and systematising electronic money distributors and payment agents is also encouraged.
TAXATION OF THE DIGITALISED ECONOMY
On 15 January, KPMG published the latest edition of this regular update. It covers direct and indirect taxes.
US STATE DEPARTMENT AMENDS AND/OR RENEWS TERRORIST DESIGNATIONS OF VARIOUS ORGANISATIONS
A State Department news release on 14 January advised that the State Department has amended the terrorist designations of Lashkar i Jhangvi (LJ) and ISIL Sinai Peninsula (ISIL-SP) to include additional aliases. It has also reviewed and maintained the Foreign Terrorist Organization (FTO) designations of LJ, ISIL-SP, Lashkar-e-Tayyiba, Jaysh Rijal al-Tariq al Naqshabandi, Jama’atu Ansarul Muslimina Fi Biladis-Sudan (Ansaru), al-Nusrah Front, Continuity Irish Republican Army, and the Irish National Liberation Army.
LOS ANGELES-AREA MAN SENTENCED TO 10 YEARS IN PRISON FOR KEY ROLE IN MASSIVE PYRAMID INVESTMENT SCHEME
A news release from the US Immigration & Customs Enforcement on 13 January advised that Steve Chen, 63, (aka “Li Chen” and “Boss”) has been sentenced to 120 months in federal prison for fraudulently obtaining $147 million from tens of thousands of investors around the world in a massive investment scam where a multinational company issued a phony digital currency purportedly backed by billions of dollars’ worth of amber and other gemstones. He was the owner and CEO of US Fine Investment Arts Inc (USFIA), and 6 other companies and, in 2013-15, Chen fraudulently promoted and solicited investments, and he ultimately obtained approximately $147 million from 72,000 victims, in one of the largest pyramid schemes ever prosecuted by the US Attorney for the Central District of California. He falsely promoted USFIA as a successful multi-level marketing company that extracted amber and other gemstones from non-existent mines it “owned” in the US, the Dominican Republic, Argentina and Mexico.
RACEHORSE TRAINER EXPRESSES ‘HUGE RELIEF’ AS VAT FEARS EASE OVER CHELTENHAM TRIPS
On 15 January, the Guardian and Irish media reported that fears that horses travelling to Britain from Ireland and France to compete at major racing festivals would be subject to refundable VAT charged at 19% of their value have receded after Willie Mullins’s mare Grangee, the likely favourite for a valuable bumper at Market Rasen on 16 January, entered the UK without any charge being levied. He is quoted as saying that, “There’s a bit more red tape between the departments of agriculture on both sides, but once you have a good shipping agent that’s easy enough. It’s probably going to cost a little more but that’s bearable. It will be different if a horse is moving permanently”.
MEMBERS AND ASSOCIATES OF GAMBINO CRIME FAMILY PLEAD GUILTY TO CRIMES INCLUDING RACKETEERING CONSPIRACY, WIRE FRAUD, MONEY LAUNDERING AND OBSTRUCTION OF JUSTICE
On 15 January, a news release from the US DoJ advised that 11 members and associates of the Gambino organised crime family of La Cosa Nostra pleaded guilty to multiple crimes, including racketeering conspiracy, fraud, obstruction of justice and related offenses for criminal activities throughout the New York metropolitan area committed as part of the illicit activities of the Gambino family. The racketeering was involved in the construction sector.
US: 6 CONVICTED AND SENTENCED IN MASSIVE CONTRACTING FRAUD AND MONEY LAUNDERING SCHEME IN INDIANAPOLIS
A news release from the US DoJ on 15 January advised that Ernie Perkins, 40, the owner of Remarkable Creative Enterprises, was sentenced to 70 months imprisonment in connection with his role in a massive, years-long fraud conspiracy that resulted in the theft of more than $8.4 million from a Pennsylvania based bank and a Pennsylvania based insurance company. 5 others were convicted of various charges related to the scheme, including theft by a bank employee, money laundering, mail fraud and tax evasion.
DUTCH GOVERNMENT RESIGNS AFTER FAMILIES WERE WRONGLY ACCUSED OF WELFARE FRAUD
On 15 January, The New Daily and others reported that the Netherlands government has resigned over a welfare fraud scandal that wrongfully drove thousands of families to financial ruin. The resignation follows a parliamentary inquiry last month that concluded that bureaucrats at the tax service had wrongly accused families of fraud over childcare subsidies. It said about 10,000 families had been wrongfully forced to repay tens of thousands of euros of subsidies, in some cases leading to unemployment, bankruptcies and divorces. It described such mismanagement over a decade as an “unprecedented injustice”.
JAPAN: EX-FARM MINISTER YOSHIKAWA INDICTED ON BRIBERY CHARGE
On 15 January, Japan Today reported that former Japanese farm minister Takamori Yoshikawa, 70, was indicted without arrest on a charge of receiving bribes from an egg production company while in office, prosecutors said. He received payment from a former representative of Akita Foods Co on 3 occasions 2018-19, when he was agriculture, forestry and fisheries minister.
THE EU-UK BREXIT DEAL AND FINANCIAL SERVICES – WHERE DO THINGS STAND NOW?
On 13 January, Irish law firm Matheson published an Insight in which Matheson’s Financial Institutions Group considers the limited treatment of financial services in the Brexit Deal and what that means for financial services firms now and into the future.
US DOJ BRINGS FIRST CRIMINAL “NO-POACH” AND “WAGE-FIXING” PROSECUTIONS WITH NEW FOCUS ON LABOUR MARKET PROSECUTIONS
An article from Cadwalader Wickersham & Taft LLP on 15 January said that, on 5 January, a federal grand jury returned an indictment charging Surgical Care Affiliates LLC and its related entity, which own and operate outpatient medical care centres across the US, for agreeing with competitors not to solicit senior-level employees. This followed the indictment of the former owner of a therapist staffing company, for participating in a conspiracy to fix prices by lowering the rates paid to physical therapists and physical therapist assistants. The article says that these indictments mark the first times that the DoJ has challenged alleged no-poaching and wage-fixing agreements as criminal violations of federal anti-trust law. After reviewing the position, the article advises that employee training should encompass the anti-trust risks associated with hiring practices, compensation-related issues and communications with others involved in hiring and recruiting employees. Companies also should review their employee-related agreements to remove or update any provisions that may implicate illegal no-poach or wage-fixing agreements.
PIRACY AND ARMED ROBBERY IN: ASIA IN 2020: 17% YEAR-ON-YEAR INCREASE IN TOTAL INCIDENTS AND 32% INCREASE IN ACTUAL INCIDENTS
On 15 January, Hellenic Shipping News reported that the ReCAAP Information Sharing Centre (ISC) has released its Annual Report 2020 and the article contains highlights of the report. There was a total of 97 incidents of piracy and armed robbery reported in Asia in 2020, comprising 95 actual incidents and 2 attempted incidents. The increase of incidents occurred in Bangladesh, India, the Philippines, Vietnam, South China Sea and Singapore Strait.
US: CORPORATE TRANSPARENCY ACT AND IMPLICATIONS FOR ENTITY FORMATION AND TRANSACTION STRUCTURES
On 13 January, an article from White & Williams LLP looks at the Corporate Transparency Act (CTA), contained within the National Defense Authorization Act for Fiscal Year 2021 and the impact of the former on structures that are routinely used for acquisitions and lending transactions that are fully legitimate. It says that, prior to the enactment of the CTA, the personal information of the beneficial owners would generally not be disclosed to any governmental entity, except to the extent a particular jurisdiction requires such information to be included in the routine filings to form and maintain the Reporting Entity or to obtain an employer identification number (EIN) from the IRS. It says that it remains to be seen whether or not the CTA will have a substantial impact on businesses and investors going forward.
US SLAPS SANCTIONS ON COMPANIES TRADING WITH IRAN SHIPPING LINE IRISL
On 15 January, Rferl reported that the US has sanctioned companies in Iran, China, and UAE for trading in steel with the Islamic Republic of Iran Shipping Lines (IRISL). They include Chinese-based Jiangyin Mascot Special Steel Co. and UAE-based Accenture Building Materials.
If you would like to make a (polite) gesture and make a (very) modest contribution to my ongoing with my relocation, removal and computer costs, I have a page at https://www.buymeacoffee.com/KoIvM842y