Panama Covid-19 update – despite the gradual reduction in numbers, on 15 March it was announced that the US had donated 4 more mobile hospitals to Panama. They have a total capacity of 160 beds, and are equipped with air conditioner units, fans and electric power plant.
Meanwhile, “only” 236 new cases and 9 new fatalities reported today. Deaths have now topped 6,000 in the last year – reaching 6,005 today. At the moment there are 5,873 active cases, with 98 in ICU and 683 in other wards.
15 March 2021
UK AND ISLE OF MAN: ADDITIONAL NAMES SUBJECT TO SYRIA SANCTIONS
On 15 March, HM Treasury issued a Notice and the Isle of Man advised that 6 new names had been added to the list of those persons subject to sanctions connected to the situation in Syria.
https://www.gov.im/news/2021/mar/15/financial-sanctions-syria/
WHISTLE-BLOWER SAYS CREDIT SUISSE HELPED CLIENTS SKIP TAXES AFTER PROMISING TO STOP
On 13 March, the New York Times reported that 7 years after Credit Suisse promised federal prosecutors that it would stop helping rich Americans hide their wealth from tax collectors, a whistle-blower is contending that it continued to do just that, raising the possibility that the Swiss bank could face a fresh investigation and steep financial penalties. In 2014, Credit Suisse was fined a total of $2.6 billion, but avoided even higher fines because it vowed to end the practices, and would close “any and all accounts of recalcitrant account-holders”. The bank also pledged to help the US pursue other criminal investigations, according to the plea agreement.
https://www.nytimes.com/2021/03/13/business/whistle-blower-credit-suisse-taxes.html
SEAFOOD FRAUD HAPPENING ON A VAST GLOBAL SCALE
On 15 March, the Guardian carried a feature claiming that Guardian analysis of 44 studies finds nearly 40% of 9,000 products from restaurants, markets and fishmongers were mislabelled. Samples in more than 30 countries found that 36% were mislabelled, exposing seafood fraud on a vast global scale. The UK and Canada had the highest rates of mislabelling in that study, at 55%, followed by the US at 38%. Sometimes the fish were labelled as different species in the same family, but other substitutes were of endangered or vulnerable species.
SINGAPORE LURES IN THE RICH WITH FRIENDLY RULES AND SUBSIDIES
On 14 March, Nikkei Asia reported that Singapore is becoming the playground of the super wealthy. With its low-tax regime and its free-market credentials, foreign funds and assets have been flowing into the country even during the pandemic. On their tail, their wealthy owners have also rocked up to the Monaco of the east, some fleeing the political instability in Hong Kong.
NAVIGATING BRIBERY AND CORRUPTION RISK IN 2020
On 1 March, law firm Hogan Lovells issued its “Steering the Course” report which examines the approaches, concerns and regional differences of multinational corporates across the globe on all aspects of anti-bribery & corruption. It involved opinion research conducted amongst 700 chief compliance officers (CCO), heads of legal, or equivalent (referred to collectively as “compliance leaders” in the report), working in multinational companies with at least 2,000 employees. The study focused on f4our high-risk sectors at the heart of global AB&C regulation and investigations: technology, media and telecommunications (TMT); life sciences and pharmaceuticals; energy, minerals and natural resources; and transportation, including aviation and automotive.
https://stc.hoganlovellsabc.com
WHAT SHOULD BE IN YOUR AML LAW FIRM RISK ASSESSMENT?
On 11 March, an article from Jonathan Bray Ltd contained a pdf checklist of the requirements placed on law firms in England and Wales and found in 3 sources – from the SRA regulator, the Legal Sector Affinity Group and in relevant regulations.
https://www.jonathonbray.com/wp-content/uploads/2021/03/fwra-checklist-110321.pdf
ROBOCALLING + SHAM CHARITIES = $110 MILLION JUDGMENT
An article from Frankfurt Kurnit Klein & Selz PC on 11 March was concerned with a FTC settlement with Associated Community Services (ACS) and a number of related defendants involving a $110+ million judgment. The action, brought with 46 agencies from 38 US states and the District of Columbia, involved a massive “telefunding” operation. The complaint alleged that the defendants not only conducted a robocall “onslaught” using soundboard technology to solicit donations, in violation of the Telemarketing Sales Rule, but they kept most of money they collected rather than provide it to the charities.
https://advertisinglaw.fkks.com/post/102gt1x/robocalling-sham-charities-110-million-judgment
FRENCH WARSHIP CATCHES SHIP-TO-SHIP TRANSFER ON MISSION TO STOP NORTH KOREAN SMUGGLING
On 15 March, NK Pro reported that a French frigate warship deployed to detect illicit North Korean ship-to-ship transfers discovered 2 unflagged merchant ships late last month in the East China Sea. Photos released by France Pacific Command (ALPACI) on social media showed 2 oil tankers lashed together with hoses at night in a “suspected ship transfer,” according to ALPACI.
EXPLORING THE UNDERGROUND CRIME WORLD OF PLANT SMUGGLING
On 15 March, Times Live in South Africa carried an interview with thriller write Tony Park, whose latest book involves valuable cycads and collectors, and a thriving illegal market in cycads and how individual rare plants were worth hundreds of thousands of dollars to crooked collectors.
EU REGULATION CANCELS EGYPT SANCTIONS
On 12 March, EU Regulation 2021/445/EU had the effect of repealing EU Regulation 270/2011/EU, and thereby cancelling the EU Egypt sanctions regime.
POLICE COOPERATION: IRELAND JOINS THE SCHENGEN INFORMATION SYSTEM (SIS)
On 15 March, the EU announced that Ireland had joined the SIS, the largest and most widely used information-sharing system for internal security and external border management in Europe. When conducting passport checks at the Irish border, law enforcement authorities will now receive real time information on people accused or convicted of crimes in other EU countries, Norway, Iceland, Switzerland and Lichtenstein. National authorities will also have access to information on missing people in need of protection and stolen property, such as vehicles. At the end of 2020, the SIS approximately 93 million alerts. It was accessed 3.7 billion times in 2020 and contained 209,178 hits.
https://ec.europa.eu/commission/presscorner/detail/en/MEX_21_1183
POSTAL OPERATORS BRACED FOR PARCEL DELAYS IN US AND EU
On 15 March, Lloyds Loading List reported that postal operators are bracing themselves for potential disruption to parcel deliveries with the coming into force from 15 March of the US’ STOP Act and the EU Import Control System 2 (ICS2), an international trade expert has warned.
UK PENSIONS REGULATOR CONSULTS ON APPROACH TO NEW CRIMINAL OFFENCES
On 15 March, an article from Allen & Overy reported that the UK Pensions Regulator is consulting on its approach to investigating and prosecuting new criminal offences under the Pension Schemes Act 2021. It says that these are eagerly-awaited by employers, lenders, trustees and advisers, and that the guidance provides comfort in some areas but leaves gaps and raises questions in others.
https://www.jdsupra.com/legalnews/uk-pensions-regulator-consults-on-8527675/
FIGHTING MATCH-FIXING WITH DATA
On 15 March, Control Risks published an interview with Nick Ilife, Integrity Intelligence Manager at Stats Perform, the leading sports data and analytics company. The discussion is of the increasing prevalence of match-fixing in sport and how Stats Perform uses data analytics and AI to monitor millions of sporting events globally in real time each year.
https://www.controlrisks.com/our-thinking/podcasts/in-focus-channel/fighting-match-fixing-with-data
SYRIA’S FIRST LADY COULD BE PROSECUTED IN UK AND HAVE HER BRITISH CITIZENSHIP REVOKED
On 15 March, Eurasia Review reported that Syria’s first lady, Asma Al-Assad, 45, who is also a British citizen, may be prosecuted and stripped of her UK citizenship after a preliminary investigation was opened into allegations that she incited and encouraged terrorist acts during the country’s civil war.
SINGAPORE: COURT CONVICTS MAN OF FALSE TRADING AND DECEPTION
A release on Mondo Visione on 15 March reported that Wong Leon Keat had been sentenced on 12 March to a total of 8 weeks’ imprisonment and a fine of $30,000 for false trading and deceiving a brokerage firm while trading in the shares of Gaylin Holdings Limited. He was convicted on 11 February, his conviction was the result of a joint investigation conducted by the Monetary Authority of Singapore (MAS) and the Commercial Affairs Department of the Singapore Police Force, following a referral by the Singapore Exchange Securities Trading Limited (SGX-ST) to the MAS.
UK: PAIR JAILED FOR TEXT MESSAGE FRAUD THAT SWINDLED £20 MILLION FROM BANK CUSTOMERS AND FUNDED LUXURY SHOPPING SPREES
On 12 March, The Independent reported that the 2 men responsible for the laundering operation – Quin Huang and Clarke Morgan-Findlay – were jailed for a total of 8 years between them for their part in a sophisticated and growing class of hi-tech theft known as “smishing”. The technique, which involves sending apparently genuine mobile phone text messages from organisations ranging from banks to the NHS to elicit personal and financial information, is increasingly being deployed by organised crime gangs to commit large-scale fraud.
REGULATED INDUSTRIES SHOULD BE PROSECUTED FOR FAILING TO REPORT MONEY LAUNDERING, SAYS RESEARCH GROUP TO GOVERNMENT INQUIRY
The Department of Politics and International Research at Oxford University on 11 March published an article saying that compliance with AML regulations will remain low until there is enforcement, according to recently published submission to a Government inquiry into economic crime. It is said that evidence suggests that the UK banking and real estate industries fail to properly implement the risk-based approach mandated in AML regulations. This is considered most likely due to insufficient effective enforcement. Since January 2019, the research group who authored the report has been part of the Global Integrity Anti-Corruption Evidence (GI-ACE) programme, funded by the UK Government. It explored the checks on PEP buying property in the UK, the checks banks perform on high-risk corporate clients, and the issue of ‘reputation laundering’ through philanthropic donations and other means. The research team recommended various policy measures for the UK government, and these are reproduced in the article.
PRIMARK SUPPLIER ACCUSED OF LOCKING WORKERS IN FACTORY IN MYANMAR PROTESTS
On 13 March, the Guardian reported claims that garment workers in Myanmar who produce clothing for Primark were locked inside their factory by supervisors who tried to prevent them from joining anti-coup protests. Up to 1,000 workers were trapped inside, according to workers, who said they were able to break free after several hours.
US INDICTS SKY GLOBAL CEO FOR PROVIDING ENCRYPTED PHONES TO CRIMINAL GANGS
On 14 March, The Record reported that the US DoJ has charged Jean-Francois Eap, a Canadian citizen the CEO of Sky Global, the parent company behind Sky ECC, a mobile encrypted communications platform primarily used by criminal organisations. Also charged was Thomas Herdman, a former distributor of Sky Global encrypted devices. Both were charged under the RICO Act, a law that has been rarely used to go after technology companies.
https://therecord.media/us-indicts-sky-global-ceo-for-providing-encrypted-phones-to-criminal-gangs/
CATS ARE NOW BEING USED TO LAUNDER THAILAND’S DIRTY DRUG MONEY
On 15 March, the Coconuts website in Thailand reported on the case of 6 seized kittens, saying that the cats, which can fetch prices in the tens of thousands of baht are one way the drug traffickers launder their money.
https://coconuts.co/bangkok/news/kitties-are-now-being-used-to-launder-thailands-dirty-drug-money/
WeLeakInfo LEAKED CUSTOMER PAYMENT INFORMATION
On 15 March, the Krebs on Security blog reported that, in an ironic turn of events, a lapsed domain registration tied to WeLeakInfo let someone plunder and publish account data on 24,000 customers who paid to access the service with a credit card. WeLeakInfo had been seized by the FBI and law enforcement partners overseas, being a service that sold access to more than 12 billion usernames and passwords stolen from thousands of hacked websites.
https://krebsonsecurity.com/2021/03/weleakinfo-leaked-customer-payment-info/
BRAZILIAN PETROCHEMICAL COMPANY BRASKEM SA INVESTIGATING ALLEGED “IMPROPER PAYMENTS” RELATED TO AN ETHYLENE PROJECT IN MEXICO
A post on the always worth watching FCPA Blog reported that the company had disclosed the investigation in a SEC filing. The biggest shareholder in Braskem was Odebrecht SA, and the two had previously resolved FCPA offences in 2016.
https://fcpablog.com/2021/03/15/chemical-giant-braskem-discloses-new-corruption-investigation/
MOZAMBIQUE: THE PROBLEM WITH FOREIGN TERRORIST ORGANIZATION (FTO) DESIGNATIONS
On 12 March, an article from the Center for Strategic and International Studies said that on 10 March, the US State Department designated the Islamic State of Iraq and Syria-Mozambique (ISIS-Mozambique) and the Islamic State of Iraq and Syria-Democratic Republic of the Congo (ISIS-DRC) as Foreign Terrorist Organizations (FTO) while also designating respective leaders of those organizations. The article argues that the designation risks impeding humanitarian efforts and hobbling potential disarmament, demobilization, and reintegration (DDR) activities. In addition, it is unlikely to significantly advance US counter-terrorism and counter-insurgency efforts.
https://www.csis.org/analysis/mozambique-problem-foreign-terrorist-organization-fto-designations
UK FIRMS FACE SIGNIFICANT COSTS AS SCC REWORKING EXERCISE LOOMS
On 15 March, an article from Field Fisher reported that another significant data protection event and challenge is on the horizon for businesses in the UK, the anticipated publication of new standard contractual clauses (SCC) later this year, which results in the repeal of the current SCC. The cost to business of putting in place measures such as SCC to facilitate the flow of personal data between the EU and the UK, could be between £1billion and £1.6 billion – but it is also said that the cost to business in the EU, UK and beyond of reworking all contracts that use the current SCC will be significantly higher. SCC are a widely used mechanism to allow for the transfer of personal data to third countries in accordance with the GDPR, and it is known that the UK Information Commissioner’s Office is currently reviewing the new SCC – and that the requirement to “re-paper” relevant contracts within the 12-month grace period will be burdensome both in time and cost.
https://www.fieldfisher.com/en/insights/uk-firms-face-significant-costs-as-scc-re-papering
SEC SIGNALS SUPPORT FOR SINGLE GLOBAL ESG DISCLOSURE FRAMEWORK
On 15 March, the Compliance & Enforcement blog from the Program on Corporate Compliance and Enforcement at the New York University School of Law contains observations on what a recent statement from the SEC may indicate about the direction of globally coordinated efforts on ESG disclosure. The SEC and the International Organization of Securities Commissions (IOSCO) have showed support for the work of the International Financial Reporting Standards Foundation (IFRS).
Meanwhile, a Client Alert from Wilmer Hale on 15 March said that the SEC has announced in recent weeks multiple efforts to highlight climate change in corporate disclosures and to increase scrutiny and, potentially, enforcement focus on company disclosure efforts on climate and other environmental, social, and governance (ESG) matters. It is said that the increased attention to the topic, and climate change in particular, is noteworthy and expected to remain an area of focus at the SEC and under the Biden Administration more broadly. The Client Alert suggests that a new SEC release refreshing the existing climate change disclosure guidance is highly likely, and new rulemaking efforts aimed at requiring more specific disclosures in that area are also likely. Although climate change is the current focus, investors and the SEC could soon turn to disclosures about other ESG concepts, such as racial equity, environmental justice, human capital, and political contributions.
OHIO-BASED MANUFACTURER OF PROCESS CONTROLS, AIRFLOW PRESSURE SWITCHES, BOILER CONTROLS, AND OTHER INSTRUMENTATION HAS AGREED TO PAY A $216,464 PENALTY FOR APPARENT VIOLATIONS OF THE IRAN SANCTIONS REGIME
On 15 March, a news release from the US Treasury advised that UnitControl Inc had failed to act on multiple apparent warning signs when it exported 19 shipments of its goods from the US to 2 European companies with reason to know that the goods were intended specifically for supply, transshipment, or re-exportation to Iran by the 2 European companies.
https://home.treasury.gov/system/files/126/20210315_uc.pdf
https://www.visualcapitalist.com/top-20-countries-for-ultra-high-net-worth-individuals/
SPANISH POLICE SEIZE FIRST EVER NARCO-SUBMARINE MADE IN EUROPE
On 15 March, a news release from Europol advised that Spanish National Police, in close cooperation with Europol and law enforcement from five other countries, have seized in the city of Málaga the first ever half-submersible vessel being built on European territory. Similar vessels captured in the past have always been of Latin American manufacture.
EUIPO AND EUROJUST STEP UP COOPERATION TO TACKLE IP CRIME
A news release from the EU Intellectual Property Office on 15 March advised that the 2 agencies are stepping up their cooperation to more effectively tackle criminal abuse of intellectual property rights in the field of counterfeiting and online piracy. A Service Level Agreement (SLA) was signed to boost Eurojust’s capacity and expand its expertise to support complex investigations in this field.
https://euipo.europa.eu/ohimportal/en/web/guest/news/-/action/view/8583867
ECONOMIC COMMUNITY OF WEST AFRICAN STATES (ECOWAS) COURT TELLS CAPE VERDE TO CEASE ALL EXTRADITION PROCEEDINGS AGAINST ALEX SAAB AND COMPENSATE HIM
On 15 March, AP reported that the court has ordered the immediate release of a Venezuelan businessman close to President Nicolas Maduro, finding that his arrest in Cape Verde on US money laundering charges was unlawful. It instructed Cape Verde to cease all extradition proceedings against Alex Saab and compensate him $200,000 for damages. However, Saab is already in court in Miami.
SEC SUES CALIFORNIA TRADER FOR SOCIAL MEDIA FRAUD SCHEME
On 15 March, Reuters reported that the SEC has charged Andrew L. Fassari (or @OCMillionaire on Twitter), a California-based trader for an alleged fraud scheme in which he spread false information about a defunct company on Twitter.
IRELAND: MAN IN MAJOR ACCOUNTANCY FIRM SUSPECTED OF €1 MILLION-PLUS FRAUD
On 15 March, the Irish Times reported that a senior employee of a large Dublin accountancy firm managed to claim more than €1 million in fraudulent expenses over a 2-year period, gardaí suspect. He was allegedly claiming for expenses for both personal matters and for non-existent work done on behalf of the company, which is understood to be one of the major accountancy firms in the Irish market.
HONG KONG FREEZES ACCOUNTS LINKED TO SUSPECTED SOCIAL MEDIA RAMP AND DUMP SCHEME
A release on Mondo Visione on 15 March advised that the Securities and Futures Commission (SFC) has issued restriction notices to 15 brokers, prohibiting them from dealing with or processing certain assets held in 32 trading accounts, which are related to a suspected social media ramp-and-dump scam involving the manipulation of the market in the shares of a company listed on The Stock Exchange of Hong Kong Limited between November 2019 and November 2020.
HONG KONG FINES FIRM $7.2 MILLION FOR FAILURES IN COMPLYING WITH AML/CFT REGULATORY REQUIREMENTS WHEN HANDLING CASH DEPOSITS AND THIRD-PARTY FUND TRANSFERS
On 15 March, a release on Mondo Visione advised that the Securities and Futures Commission (SFC) has reprimanded and fined Sino-Rich Securities & Futures Limited (Sino-Rich) $7.2 million.
BitMEX FOUNDER SURRENDERS TO FACE US LAUNDERING CHARGES
On 15 March, BNN Bloomberg reported that Benjamin Delo ,one of the founders of pioneering crypto-derivatives exchange BitMEX, surrendered to authorities to face charges that he schemed to avoid US AML laws.
https://www.bnnbloomberg.ca/bitmex-founder-delo-surrenders-to-face-u-s-laundering-charges-1.1577447
US: PHARMACY OWNER AND ACCOUNTANT INDICTED IN $134 MILLION HEALTH CARE FRAUD SCHEME
An article from Arent Fox on 15 March advised that Mohamed Mokbel and Fathy Elsafty, of Houston, Texas, have been arrested on charges of money laundering, health care fraud, and conspiracy to commit health care fraud for their participation in an alleged pharmacy fraud scheme. Mokbel served as CEO of 4M Pharmaceuticals, Inc., the parent company of several retail pharmacies that operated in Texas and Florida, and Elsafty was 4M Pharmaceutical’s accountant and tax preparer. Both individuals had ownership interests in the retail pharmacies.
https://www.jdsupra.com/legalnews/investigations-newsletter-pharmacy-3933516/
BANGLADESH: JAIL TERM FOR TRADE-BASED MONEY LAUNDERERS
On 15 March, the Daily Star in Bangladesh reported that businesspeople will be sentenced to 7 years in prison if they make the wrong declaration on exports, imports and investment abroad as the government has moved to rein in trade-based money-laundering. The finance ministry issued an order to this effect based on the Foreign Exchange Regulation Act 1947.
https://www.thedailystar.net/business/news/now-jail-term-trade-based-money-launderers-2061305
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