OTHER THINGS YOU MAY HAVE MISSED – JANUARY 25

Panama Covid-19 update – as the vaccinating programme continues steadily, the restrictions remain in place and the numbers appear to be slowly coming into some sort of control.

Today, another 914 new cases and 34 new fatalities; with 45,769 active cases – of whom 237 are in ICU and 2,473 in other hospital wards.

25 NOVEMBER 2021

PHILIPPINES’ CENTRAL BANK HIGHLIGHTS AML RISKS OF CASH AND CROSS-BORDER PAYMENTS

On 25 January, Regulation Asia reported that the BSP (Bangko Sentral ng Pilipinas) has published a new report presenting an assessment of the risks that cash, cross border and cross-sector transactions pose for money laundering, terrorism financing and proliferation financing. According to the report, cash has continued to be an attractive medium for money laundering due to its fungible character and ability to leave little to no evidence trail.  In the Philippines, cash transactions accounted for about 20% of CTR (covered transaction reports) by value, and over 50% of all low value STR.

https://www.regulationasia.com/bsp-highlights-aml-risks-of-cash-cross-border-payments/

THE COST OF INACTION IN A VARIETY OF AREAS – RANGING FROM RUSSIA TO AFRICA, FROM CYBERSPACE TO ENVIRONMENTAL MATTERS

A Research Paper from the EU Institute for Security Studies on 22 January contains 12 scenarios which draw attention to the cost of inaction in a variety of areas, ranging from Russia to Africa, from cyberspace to environmental matters.  They highlight the (geo)political, economic and strategic implications of not taking action at a critical juncture.  Together, they apply the precautionary principle to foreign and security policy, whereby calculating the different consequences of action and inaction in the future would help policymakers take crucial decisions ahead of time.

https://www.iss.europa.eu/sites/default/files/EUISSFiles/CP_163.pdf

US DoJ WEIGHS AMNESTY FOR ACADEMICS TO DISCLOSE FOREIGN FUNDING

On 22 January, the Wall Street Journal reported that DoJ officials are weighing an amnesty program under which US academics could disclose past foreign funding without fear of punishment for their disclosures, according to people familiar with the matter.  Federal prosecutors have brought more than a dozen criminal cases since mid-2019 accusing academics of lying about receiving Chinese government funding or alleging that visiting researchers lied about their affiliation with the Chinese military, some of which have resulted in guilty pleas.

https://www.wsj.com/articles/justice-department-weighs-amnesty-for-academics-to-disclose-foreign-funding-11611345451

AML IN THE DUBAI INTERNATIONAL FINANCE CENTRE (DIFC)

On 6 January, Freshfields Bruckhaus Deringer LLP published a post saying that the UAE has strengthened AML laws in recent years: the federal laws were overhauled as recently as 2018 and 2019, while the Dubai International Finance Centre (DIFC) updated its AML rules in April 2020 to reflect the federal-level changes.  The post looks at the federal and DIFC AML regimes, and what entities operating in the DIFC and regulated by the DIFC’s financial services regulator (the Dubai Financial Services Authority or DFSA) must do to comply. Even if a DIFC-registered entity is not regulated by the DFSA, it should not ignore money laundering risks in its business.

https://riskandcompliance.freshfields.com/post/102go35/beware-of-money-laundering-risks-in-the-uae-difc

CORPORATE CRIMINAL LIABILITY REFORM – PRESSURE IS ON THE LAW COMMISSION AS MPs EXPRESS THEIR FRUSTRATION AT DELAY

On 15 January, an article from Kingsley Napley says that the spectre of a failure to prevent economic crime offences for corporates once again received attention during a debate in Parliament on 13 January as part of the consideration of the Financial Services Bill.  Although the amendments (to introduce a “failure to prevent” offence) were not taken forward, the debate rehearsed many of the arguments and submissions that will inevitably be presented to the Law Commission, which has been tasked to investigate the laws around corporate criminal liability and provide options for reform.

https://www.kingsleynapley.co.uk/insights/blogs/criminal-law-blog/corporate-criminal-liability-reform-the-pressure-is-on-the-law-commission-as-mps-express-their-frustration-at-delay#page=1

EUROPEAN COMMISSION ISSUES GUIDANCE NOTE ON THE EU GLOBAL HUMAN RIGHTS SANCTIONS REGIME

On 14 January, an article from Steptoe & Johnson LLP says that the stated aim of the Guidance Note is to address the questions most likely to arise in the application of the new restrictions and to ensure their uniform implementation by EU operators and EU Member States competent authorities.  The Guidance Note provides guidance on the scope of financial restrictions, including the freezing of funds and economic resources and the prohibition to make funds and economic resources available to sanctioned persons, entities and organisations.  It also addresses compliance obligations and specific notions, such as “ownership” and “control” of entities by listed persons.  Further, the Guidance contains information on exceptions and derogations, including for the provision of humanitarian aid.  The article says that, unfortunately, the Guidance Note does not provide many detailed answers and mainly reiterates what is already included in the EU Regulation itself as well as basic concepts set out in the EU Council’s sanctions guidelines and best practices, and therefore, its practical relevance is rather limited.

https://www.steptoeinternationalcomplianceblog.com/2021/01/european-commission-issues-guidance-note-on-the-eu-global-human-rights-sanctions-regime/#page=1

ACTIVISTS IN PUSH TO BLOCK SALE OF ISRAELI FIREARMS TO UGANDA

On 24 January, the Daily Monitor reported that an Israeli court is scheduled to start hearing the case on 15 February in which human rights activists want the Israeli government to stop selling and exporting firearms to the Special Forces Command (SFC), a semi-independent unit of the Uganda People’s Defence Forces (UPDF).  The activists in the petition described SFC as  “outside any legal framework in Uganda” and which has been turned into “a unit of repression”, citing numerous cases, including the 2017 raid on Parliament to neutralise dissenters of the presidential age limit amendment.

https://www.monitor.co.ug/uganda/news/national/activists-in-push-to-block-sale-of-israeli-firearms-to-sfc-3267264

PHILIPPINES TO ADD POGO TO AML LAW TO AVOID FATF GREY LIST

On 25 January, GGR Asia reported that the Philippines Senate and House of Representatives have respectively approved amendments to the country’s Anti- Money Laundering Act adding Philippine Offshore Gaming Operators (POGO) and their “service providers” as “covered persons” under the legislation.  The changes still need the assent of the country’s President Rodrigo Duterte.  Under proposed amendments a single cash transaction by a POGO or by a service provider for a POGO, in excess of US$104,028, or “its equivalent in any other currency”, will be defined as a “covered transaction” – a rule that already applied to “casinos”, including Internet and ship-based venues, as well as land-based ones.  A transaction in cash, or “other equivalent monetary instrument”, involving a total amount “in excess of around US$10,000 within 1 banking day” is also considered to be a covered transaction.

https://www.ggrasia.com/philippines-to-add-pogos-to-aml-law-to-avoid-fatf-grey-list/

INDIA: MUMBAI BUILDER GROUP RAIDED IN YES BANK MONEY LAUNDERING CASE

On 25 January, Mint reported that premises of Omkar Realtors and Developers, that includes 7 residential and 3 official in Mumbai, were searched by the Enforcement Directorate in connection with its money laundering probe in the Yes Bank alleged bank fraud case.

https://www.livemint.com/news/india/ed-raids-mumbai-builder-group-in-yes-bank-money-laundering-case-11611561599980.html

UK: FALL IN NUMBER OF PROPERTIES OWNED BY OVERSEAS FIRMS

On 25 January, Property Industry Eye reported that Brexit uncertainty has prompted overseas companies to dispose of properties, particularly in London and the South East, according to new research.  The number of properties in England and Wales owned by overseas firms has dropped by 4,000 since the EU referendum.  A small drop as, at the time of the EU referendum in June 2016 overseas company ownership of properties in England and Wales totalled 99,619.

https://propertyindustryeye.com/significant-fall-in-number-of-properties-owned-by-overseas-firms-since-eu-referendum/

UK: SEEKING ADVICE ON CONSUMER CBD (CANNABIDIOL) PRODUCTS

On 25 January, the Home Office published a news release saying that the Minister for Crime and Policing, Kit Malthouse MP, asks the ACMD advisory body to advise on how the UK can strengthen the law on consumer CBD products.  The advice will ensure the law is clear so that these products are safe for consumers and so those who seek to create legitimate, safe CBD consumer products, are able to do so more easily.

https://www.gov.uk/government/publications/advice-on-consumer-cbd-cannabidiol-products

UK POLICE POWERS: PRE-CHARGE BAIL

On 25 January, the House of Commons issued a Research Paper discusses the 2017 reforms to pre-charge bail and Government proposals for new legislation to respond to criticism of the reforms.

https://commonslibrary.parliament.uk/research-briefings/cbp-7469/

2 ARRESTED FOR ORCHESTRATING ESCAPE OF WIRECARD EXECUTIVE ACCUSED OF FRAUD

On 25 January, Coindesk reported that 2 Austrian men accused of helping Wirecard’s former chief operating officer escape to Belarus have been arrested by police in Vienna.  It is said that a former senior official of the Austrian secret service and a former right-wing politician were both apprehended in connection with Jan Marsalek’s escape. 

https://www.coindesk.com/two-arrested-for-orchestrating-escape-of-wirecard-exec-accused-of-fraud

UK-US AGREEMENT ON AUTHORISED ECONOMIC OPERATORS (AEO)

On 25 January, Sandler Travis Rosenberg reported that the US and UK have concluded an arrangement to formally recognise one another’s authorised economic operator programmes.  In the US, AEO status indicates that a business has customs control procedures in place that meet international standards and criteria and those with AEO status are deemed low-risk and enjoy trade facilitation benefits.

https://www.strtrade.com/trade-news-resources/str-trade-report/trade-report/january/u-s-uk-agreement-on-authorized-economic-operators

UK MOVES TO REGULATE ‘STABLE TOKENS’ WITH EU CRYPTOASSET REFORM LOOMING

On 25 January, an article from Out-Law says that advances in technology and innovation in payments, as well as changing consumer needs and expectations, have spurred new UK proposals to extend existing regulation of cryptoassets.  It refers to a HM Treasury consultation involving a new form of regulated cryptoasset, the ‘stable token’ – commonly also referred to as stablecoin.  It is said that HM Treasury is seeking to improve certainty for stablecoin users and the market and to address risks likely to arise on the developing market if such tokens remain outside the regulatory perimeter.

https://www.pinsentmasons.com/out-law/analysis/uk-moves-regulate-stable-tokens-eu-cryptoasset-reform-looming

EU: CJEU MUST CLEAR UP GERMAN PATENT MESS ON INTERIM INJUNCTIONS

An article from Out-Law on 25 January refers to a German case before the Court of Justice of the EU saying that the right of patent-holders to obtain an interim injunction to curtail the activities of suspected infringers pending a trial should not depend on rights holders satisfying gold-plated requirements around the validity of their patents.

https://www.pinsentmasons.com/out-law/analysis/cjeu-clear-up-german-patent-mess-interim-injunctions

NYPD DETAILS ITS USE OF CRYPTOCURRENCY TRANSACTION ANALYSIS IN POLICY DOCUMENT

On 17 January, The Block reported that the New York Police Department (NYPD) has published a 6-page document that outlines its use policy for cryptocurrency transaction analysis.  The NYPD use of such tools, sourced from unnamed “approved vendors”, was not publicly known until now.  NYPD said that it “utilises cryptocurrency analysis tools to automate the search for information associated with cryptocurrency transactions in furtherance of criminal investigations”. 

https://www.theblockcrypto.com/linked/91556/nypd-cryptocurrency-blockchain-analysis-policy

NEARLY 50 PROPERTIES SEIZED IN ACTION AGAINST MONEY LAUNDERING IN ITALY AND SPAIN

A news release from Eurojust on 22 January advised that Italian and Spanish authorities have seized nearly 50 properties and provisionally arrested 13 persons as the result of a Eurojust-coordinated operation against money laundering, tax evasion and corruption in Italy’s north-western province of Cuneo and Malaga province in Spain.  During these actions 3 luxury cars as well as cash, jewellery, valuable watches and works of art were seized.

https://www.eurojust.europa.eu/nearly-50-properties-seized-action-against-money-laundering-italy-and-spain

GANGS MADE BRITISH COLUMBIA CASINOS TOO DANGEROUS TO INVESTIGATE FOR MONEY LAUNDERING, INQUIRY HEARS

On 22 January, Global News reported that the inquiry into money laundering has heard that British Columbia’s gaming regulator concluded Asian organised crime was becoming so powerful inside its casinos after 2010 that it was too dangerous to investigate suspected drug-cash laundering estimated to reach about $200 million per year. 

https://globalnews.ca/news/7593419/bc-casinos-too-dangerous-cullen-commission/

FRENCH EX-PM BALLADUR GOES ON TRIAL OVER ‘KARACHI AFFAIR’ KICKBACK ALLEGATIONS

On 19 January, France 24 reported that former French prime minister Edouard Balladur, 91, has gone on trial on charges that he used kickbacks from arms deals in the 1990s to fund a failed presidential run.  He joins a long list of senior French politicians pursued for alleged financial wrongdoing.

https://www.france24.com/en/europe/20210119-french-ex-pm-balladur-goes-on-trial-over-karachi-affair-kickback-allegations

APPROVAL OF AUSTRALIAN MILITARY EXPORTS TO SAUDI ARABIA AND UAE CONDEMNED BY HUMAN RIGHTS GROUPS

On 18 January, the Guardian reported that Australia has approved at least 14 permits for the export of military goods to Saudi Arabia and UAE over the last year and a half, despite their involvement in the Yemen conflict which has created a humanitarian crisis.  It is also revealed that it has approved permits for $580,000 of military goods to Turkey since late 2019, even though the defence minister had announced a “pause” of such exports at that time because of concerns the country’s incursion into north-east Syria was “causing great civilian suffering”.  The latest figures have prompted calls for the Australian government to show more transparency in the way it discloses exports of weapons and other military goods.

https://www.theguardian.com/australia-news/2021/jan/19/approval-of-australian-military-exports-to-saudi-arabia-and-uae-condemned-by-human-rights-groups

THIRD COUNTRIES ALIGN WITH EU SANCTIONS ON DR CONGO

A news release from the EU on 22 January advised that North Macedonia, Montenegro, Serbia, Albania, Bosnia and Herzegovina, Iceland, Liechtenstein, Norway, Ukraine, Moldova, and Armenia have agreed to align themselves with an EU Council decision extending sanctions for a further 12 months to 12 December 2021.

https://www.consilium.europa.eu/en/press/press-releases/2021/01/22/declaration-by-the-high-representative-on-behalf-of-the-european-union-on-the-alignment-of-certain-countries-concerning-restrictive-measures-against-the-democratic-republic-of-the-congo/

US DoJ ANNOUNCES FIRST CIVIL SETTLEMENT FOR PPP FRAD

On 25 January, Cooley reported that, after bringing dozens of criminal charges against Paycheck Protection Program loan recipients in recent months, on 12 January, the DoJ announced its first civil settlement resolving allegations of PPP loan fraud.   SlideBelts, an internet retail company and debtor in bankruptcy, and its president and CEO agreed to pay a combined $100,000.  It says that the government’s civil settlement with SlideBelts and its CEO sends several notable messages to the PPP borrower community.

https://cc.cooley.com/2021/01/25/doj-announces-first-civil-settlement-for-ppp-fraud/

USING “ADVERSE MEDIA” SCREENING TO HELP STOP THE FLOW OF DIRTY MONEY

On 25 January, an article from Thomson Reuters explains that “adverse media screening”., as a component of compliance, essentially means researching whether a negative news story exists on a bank customer or party to a transaction in open-source or online press reports or public records research.  It says that the “FinCEN leaks” case shows that adverse media screening could make a difference.  For example, the FinCEN leaks case showed that one address in the UK was ranked as one of the highest-risk money laundering locations in the world.

https://www.thomsonreuters.com/en-us/posts/corporates/adverse-media-screening/

US: 5 NEW GUILTY PLEAS IN NATIONWIDE TELEMEDICINE PHARMACY HEALTH CARE FRAUD CONSPIRACY

A news release from the US DoJ on 25 January advised the latest developments in a case concerned with a nationwide conspiracy to defraud pharmacy benefit managers out of $174 million by submitting bills to the pharmacy benefit managers for fraudulent prescriptions purchased from a telemarketing company.  The indictment alleges the conspiracy began in mid-2015 and lasted through the first months of 2018. 

https://www.justice.gov/usao-edtn/pr/five-new-guilty-pleas-nationwide-telemedicine-pharmacy-health-care-fraud-conspiracy

US ANNOUNCES EXTRADITION OF KENYAN NATIONAL FOR LARGE-SCALE TRAFFICKING OF RHINOCEROS HORNS AND ELEPHANT IVORY AND HEROIN DISTRIBUTION

A news release from the US DoJ on 25 January advised that MANSUR MOHAMED SURUR (aka “Mansour”), a Kenyan citizen, had been extradited from Kenya to the US.  He had been arrested by Kenyan authorities in July 2020, in Mombasa, on charges of conspiracy to traffic in rhinoceros horns and elephant ivory which involved the illegal poaching of more than approximately 35 rhinoceros and more than 100 elephants.  In addition, he was charged with conspiracy to commit money laundering and conspiracy to distribute and possess with intent to distribute more than 10 kg of heroin.  His co-defendant, Moazu Kromah (aka “Ayoub”, “Ayuba” and “Kampala Man”), a citizen of Liberia, was previously deported to the US from Uganda on 13 June 2019.  

https://www.justice.gov/usao-sdny/pr/us-attorney-announces-extradition-kenyan-national-large-scale-trafficking-rhinoceros

UK: MPs CALL FOR INVESTIGATION INTO POSSIBLE UK LINKS TO BEIRUT PORT EXPLOSION

On 25 January, Insurance Marine News reported that 2 members of the UK Parliament have called for an investigation into a UK-registered company that could be linked to the August 2020 explosion in Beirut.  Margaret Hodge MP, a former cabinet minister, called the apparent failure to list the ultimate beneficiary of Savaro Ltd at Companies House as “outrageous”.

https://insurancemarinenews.com/insurance-marine-news/westminster-politicians-call-for-investigation-into-possible-uk-links-to-beirut-port-explosion/

UK: FRAUD EPIDEMIC ‘IS NOW NATIONAL SECURITY THREAT’

On 25 January, the BBC reported that fraud has reached epidemic levels in the UK and should be seen as a national security issue, according to the think tank the Royal United Services Institute (RUSI).  It says that UK intelligence agencies should play a greater role in responding, the RUSI argues in a report, and policing should be better resourced, working more closely with the private sector, it adds. The RUSI report argues that the scale of fraud against the private sector has an impact on the reputation of the UK as a place to do business.

https://www.bbc.com/news/business-55769991

GIBRALTAR: POLICE FREEZE £100,000 IN FRAUD INVESTIGATION

On 25 January, the Gibraltar Chronicle reported that around £100,000 held in an overseas bank account was frozen by detectives from the Royal Gibraltar Police’s Economic Crime Unit after a report of fraud was made locally.

https://www.chronicle.gi/rgp-freezes-100000-in-fraud-investigation/

PODCAST: BREAKING SLAVERY’S FINANCIAL CHAINS

The latest podcast from RUSI Centre for Financial Crime and Security Studies is concerned with modern slavery and human trafficking – described as one of the most profitable crimes in the world, generating hundreds of billions of dollars a year.  What more can the financial sector do to help tackle it?  Host Tom Keatinge is joined by financial investigations consultant and former Hong Kong law enforcement official Steve Farrer to explore new and novel ways that policy can be put into practice to combat this egregious crime.

https://rusi.org/multimedia/breaking-slaverys-financial-chains

OFAC HAS UPGRADED ITS SANCTIONS LIST SEARCH TOOL 

On 25 January, OFAC announced that it had upgraded its sanctions list search tool with fuzzy logic that is more resource-efficient.  

https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20210125

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

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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