Panama Covid-19 update – finally received my, delayed, vaccination appointment for 23 April…meanwhile, the curfew is reducing again from Monday – it will now be from midnight to 0400, and pubs and bars with outside seating etc (as most do here) can reopen.
However, the virus is still around, albeit that the Rt rate has fallen, with 395 new cases reported today, and 4 new fatalities. There remain 4,021 active cases – 61 in ICU and 404 in other wards.
14 APRIL 2021
US: BUSINESSES TARGETED BY CYBER ATTACKS – A CHECKLIST TO PROTECT YOUR COMPANY FROM RISK
On 6 April, Masuda, Funai, Eifert & Mitchell Ltd published an article which listed a number of steps which it said were to help guard against the increased threat of cybersecurity incidents, and recommended that businesses consider taking them as soon as possible.
HUMAN RIGHTS DUE DILIGENCE IN SUPPLY CHAIN CONTRACTS: A SHARED RESPONSIBILITY OF BUYER AND SUPPLIER?
On 12 April, an article from Mayer Brown said that the American Bar Association had published a report on its suggested Model Contract Clauses to Protect Workers in International Supply Chains. It suggests that these clauses, while not put forward as a binding standard, provide food for thought for companies who are seeking to align their supply chain contracts with UN guidance, and the increasing tide of mandatory human rights due diligence legislation.
LATVIAN PROBE FAILS TO PROVE ABLV MANAGERS’ INVOLVEMENT IN CORRUPTION
On 14 April, the Baltic Times reported that the Corruption Prevention and Combating Bureau (KNAB) has not found evidence of corruption on the part of ABLV Bank’s managers, which has been alleged by FinCEN.
FAKE COVID-19 CERTIFICATES AFFECTING AIRLINES
On 13 April, the Wall Street Journal reported that airlines are battling a scourge of passengers traveling with falsified Covid-19 health certificates. The International Air Transport Association (IATA) says it has tracked fake certificates in multiple countries, from France to Brazil, Bangladesh and Afghanistan. Border control authorities and police forces have also reported arrests of people selling documents in the UK, Spain, Indonesia and Zimbabwe, among others. Airlines say their staff aren’t equipped to handle and police all the new health certifications needed and worry the problem will be exacerbated when some countries also start to ask for vaccination certificates.
CYPRUS, GHANA AND KENYA JOIN GROWING LIST OF COUNTRIES TO CREATE BENEFICIAL OWNERSHIP REGISTRIES
On 13 April, ICIJ carried an update report concerning the “Panama Papers” affair.
MALAYSIA IS AMONG 3 ASEAN COUNTRIES TO HAVE ENACTED AN EXPORT CONTROL LAW WHICH ALLOWS FOR EXTRA-TERRITORIAL CRIMINAL JURISDICTION
On 14 April, the Star reported that the Strategic Trade Act 2010 regulates the activities of exports, transits, transshipments and brokering of strategic items – including arms and related material that can be used for the design, development and production of WMD and their delivery systems. Strategic items include goods and technology that are high-tech and specialised equipment. It also reports that the Strategic Trade Secretariat (STS) has been established under the Ministry of International Trade and Industry (MITI).
MALAYSIA: BANK J SAFRA SARASIN FOR MONEY LAUNDERING BREACHES
On 14 April, Fin News Asia reported that the breaches took place during customer on-boarding and in the ongoing monitoring of business relations with customers 2014-18. The Singapore branch of the Swiss wealth manager was fined S$1 by the Monetary Authority of Singapore (MAS) for serious breaches of AML/CFT requirements. It is said that in many cases, BJS relied on customers’ representations without corroboration.
LIBYA FREES UN-SANCTIONED HUMAN TRAFFICKER
On 14 April, EU Observer reported that Libya has freed a man under UN sanctions for trafficking and drowning migrants, Abd al-Rahman Milad, due to “lack of evidence” in his trial.
GULF OF GUINEA RETAINS WORLD PIRACY HOTSPOT STATUS
On 14 April, Defence Web reported that Africa, particularly the Gulf of Guinea, remains the world hotspot for piracy with 43% of all incidents reported in the first quarter of this year. A report records 38 incidents since the start of 2021 – compared with 47 incidents in the same period last year. Despite a drop in reported piracy incidents for quarter one, violence against crew is rising when compared to previous years. The Gulf of Guinea for all 40 kidnapped crew incidents, as well as the sole crew fatality.
NEW ZEALAND TO BE THE FIRST COUNTRY IN THE WORLD TO REQUIRE ITS FINANCIAL SECTOR TO DISCLOSE THE IMPACTS OF CLIMATE CHANGE ON ITS BUSINESS
On 13 April, Jurist reported that the Financial Sector (Climate-related Disclosure and Other Matters) Amendment Bill has been introduced to New Zealand’s Parliament. The Bill will require New Zealand financial institutions to report on the climate impacts of their investments and to explain the institutions’ plans for managing the climate risks and sustainability opportunities of their business decisions.
HONDURAS ARRESTS MAN WHO PURCHASED USELESS COVID MOBILE HOSPITALS
On 13 April, OCCRP reported that Honduran authorities have arrested the former head of an institution that purchased old and useless mobile hospitals at highly inflated prices for the Honduran government at the hight of the COVID-19 pandemic. It bought 7 mobile hospitals as part of the emergency purchases for a value of about $47 million.
UK: SOLICITOR STRUCK OFF FOR “SOPHISTICATED” LAND REGISTRY FRAUD
On 14 April, Legal Futures reported that a solicitor jailed for more than 3 years for forging Land Registry documents in a family dispute with the owners of a Newcastle takeaway has been struck off. She was described by the judge who convicted her as “cunning” and “manipulative”.
COSTA RICAN DRUG GANG WORKED WITH AGENTS IN AN ELITE INVESTIGATIVE UNIT TO STEAL COCAINE SHIPMENTS
On 13 April, a report from Insight Crime concerns a case which the article says is yet another sign of the reach of drug corruption in the country. At least 2 agents with Costa Rica’s Judicial Investigation Department (Organismo de Investigación Judicial) have been charged with working on behalf of accused trafficker Darwin González Hernández, aka “Pancho Villa”. In December, a judge was among 16 people arrested on charges of being part of a criminal organisation dedicated to drug trafficking and money laundering. A police officer was also arrested in that case. Earlier, in November, a judge and judicial assistant were accused of receiving bribes to help traffickers avoid imprisonment, and both judges are alleged to have handed over information on local anti-narcotics operations to traffickers.
ATTORNEY-CLIENT PRIVILEGE IN THE US
On 14 April, a briefing from Eversheds Sutherland says that the application of attorney-client privilege in litigation, internal investigations, and regulatory investigations in the US is a complex area of the law. The article provides a high-level overview. It cautions that that while state jurisdictions may differ slightly, the article examines the law generally applicable to all US state jurisdictions.
THE ROLE OF DIRECTORS AND AUDITS IN TACKLING FRAUD
An article from Eversheds Sutherland on 14 April says that the Bryden Report of December 2019 in the UK concluded that reform was needed to increase the prospect of fraud detection and improve confidence in auditors in respect of the challenge of fraud in the context of corporate reporting. Recommendations sought to address this through proposed reform of relevant auditing standards, increased training in fraud detection for auditors and further explanation in the annual report from directors and auditors concerning controls around fraud – but implementation has been slow. In the UK, some recommendations have been adopted, although the Government’s proposals are subject to consultation and will not come into effect until 2023 at the earliest. However, it is said that directors and auditors will want to consider carefully what aspects of the proposals they want to adopt now, particularly given the expectation that fraud will have been on the increase during the pandemic. The article examines the new standards and the UK Government consultation.
THERE’S A GOOD CHANCE YOUR COTTON T-SHIRT WAS MADE WITH UYGHUR SLAVE LABOUR
On 9 April, the Guardian carried an article saying that much of the world’s cotton comes from the Uyghur region, where the Chinese government is ethnically cleansing its Muslim minority, and that fashion conglomerates know this. It claims that 1 in 5 cotton garments on the global marketplace is tainted by forced labour.
US: MANUFACTURER SENTENCED FOR CONSPIRING TO MANUFACTURE AND SELL COUNTERFEIT GOODS
A news release from the US DoJ on 12 April advised that a New York businessman who admitted to arranging the manufacture of counterfeit clothing, apparel, and gear, in China and Pakistan, that was shipped to wholesalers for distribution in the US, including to the US military, has been sentenced to 18 months in federal prison and ordered to pay a $15,000 fine. Bernard Klein, 40, conspired with New York wholesaler Ramin Kohanbash, 51, to arrange the mass production of goods in China and Pakistan that carried counterfeit markings and labels.
CRACKING THE ENCRYPTEDMESSAGES OF BALKAN CRIME GANMGS
On 12 April, Balkan Insight carried a feature saying that among the evidence gathered against a notorious Serbian crime gang rounded up in February were photos sent via an encrypted messaging app popular with drug smugglers. The downfall of Sky ECC and EncroChat has been a boon for police in Europe and the US, but raises a host of questions going forward. Canada-based Sky ECC described itself as “a global leader in secure messaging technology”, helping to keep a host of industries safe from identity theft and hacking. However, it is reported that law enforcement authorities in the US and Europe, however, say it was created with the sole purpose of facilitating drug trafficking and had become the messaging app of choice for transnational crime organisations. In March, the US Jean-Francois Eap, chief executive officer of Sky Global, the company behind Sky ECC, and Thomas Herdman, a former high-level distributor of Sky Global devices. Sky ECC surged in popularity after messages sent via another encrypted messaging service, EncroChat, were intercepted and decoded in a French and Dutch-led operation in mid-2020. It is said that organised crime groups from the Balkans have adapted quickly and cleverly in recent years to innovate and use technology to their advantage.
DARIO MESSER WAS ABLE TO MOVE MILLIONS OF DOLLARS THROUGH BRAZIL’S EMERALD MINING INDUSTRY
On 14 April, an article from Insight Crime reported that an investigation by Brazilian prosecutors showed that the “notorious money launderer” laundered at least $44 million between 2011 and 2017 through an exporter of precious stones based in Rio de Janeiro. The emeralds were sold to buyers abroad, mostly in India and Hong Kong. A police investigation showed that the emeralds themselves were being illegally extracted in Brazil’s north-eastern state of Bahia, an area with a history of illegal mining. Messer was a crucial actor in money laundering schemes that emerged during Operation Car Wash. In August, Messer was sentenced to over 18 years in jail by a court in Rio de Janeiro and agreed to return around $184 million in embezzled funds.
NORTH KOREAN SHIPS VISIT CHINESE COAL AND IRON PORTS – POSSIBLY FOR ILLEGAL SALES
On 14 April, NK Pro reported that at least 5 North Korea-linked ships took turns at Longkou Port for possible sales between 29 March and 13 April. The article says an analysis shows that North Korean shipping operations have returned to pre-pandemic lows as of early April after months of cargo vessels idling at sea last year, with both North Korean-flagged and foreign-flagged ships appeared to have engaged in trade.
US: PHONY IMMIGRATION ATTORNEY FILED HUNDREDS OF FRAUDULENT CLAIMS – SENTENCED TO MORE THAN 20 YEARS IN FEDERAL PRISON
On 13 April, a news release from US Immigration & Customs Enforcement advised that a Florida man, Elvis Harold Reyes, 56, was sentenced to 20 years and 9 months in federal prison for mail fraud and aggravated identity theft in connection with a scheme where he posed as an immigration attorney and filed hundreds of fraudulent asylum applications. Reyes targeted undocumented immigrants from Spanish-speaking countries who were seeking Florida driver licenses and work authorization. Reyes gave false, inaccurate and incomplete legal and immigration advice to victims to induce them to retain his services and those of his company, EHR Ministries. Reyes filed more than 225 fraudulent applications, intending to cause victim loss of more than $1 million. His victims’ actual losses exceeded $411,000. Reyes threatened aggrieved victims who confronted him by claiming that he could have them deported. And, when investigative reporting revealed the scheme, he attempted to obstruct justice by having a friend wipe his computers.
INDONESIAN MAN CONVICTED OF FRAUD TIED TO INTERNATIONAL COUNTERFEIT WINE SCAM DEPORTED FROM US
On 13 April, a news release from US Immigration & Customs Enforcement advised that Rudy Kurniawan, 44, unlawfully present in the US, was removed to his home country of Indonesia on a commercial flight. He featured in the Netflix 2016 documentary, “Sour Grapes,” which describes the story of a scheme that flooded the American wine market with fake vintage wine valued in the millions of dollars. He was sentenced to 10 years in prison for wire and mail fraud in 2014.
HMRC GUIDANCE FOR SENIOR ACCOUNTING OFFICERS (SAO) UPDATED FOLLOWING APPEAL IN THE CASTLELAW CASE
On 14 April, Ross Martin reported that the guidance has been relaxed in relation to reporting obligations for dormant companies and penalties for late certificate filing. A tribunal had found that penalties for not including a dormant company on the group notification had been correctly applied, and that there was no reasonable excuse defence available – but that HMRC should have applied its discretion in light of the facts. Under UK law, the SAO of a large company is required to ensure the existence of, and report on, the appropriateness of their tax accounting arrangements. Penalties are charged in the event of failures.
FORMER US SHOE COMPANY EXECUTIVE CHARGED IN $30 MILLION EMBEZZLEMENT SCHEME
On 14 April, Business of Fashion reported that the former chief financial officer of the over 136-year-old heritage brand has agreed to plead guilty to wire fraud, unlawful monetary transactions and filing a false tax return. He is said to have issued cheques to himself and transferred funds from company accounts to his personal accounts, and to the account of another individual — who a lawsuit names as local TV star and fashion influencer.
FRANCE: SAPIN II – WHAT RECOMMENDATIONS SHOULD BE FOLLOWED FROM 2021 ONWARDS?
On 14 April, K & L Gates published an article says that the 2016 Sapin II law introduced to legal entities additional compliance requirements to address corruption in order for France to meet the highest European and international standards. AFA urges all entities to implement an anticorruption process, independently of the thresholds required under the law. On 12 January, the AFA anti-corruption agency published new recommendations which entered into force on 13 January. AFA will refer to the Recommendations for audits that will begin 6 months after their entry into force, i.e. as of 13 July.
SEC CHARGES 2 WITH AML FAILURES FOR $1 BILLION HIGH-RISK TRANSACTIONS
On 14 April, a release on Mondo Visione advised that an indictment has charged 2 defendants with failing to maintain AML controls, failing to file SAR, and operating an unlicensed money transmitting business 2014-16. The 2 are said to have devised and executed a scheme to bring lucrative and high-risk international financial business to small, unsophisticated financial institutions. Being trained in AML compliance and procedures, they represented to the financial institutions that, because of their experience and training, they understood the risks associated with the high-risk business and would conduct appropriate AML oversight as required by the Bank Secrecy Act.
SEC CHARGES 7 WITH DEFRAUDING INVESTORS THROUGH A MULTIMILLION DOLLAR OIL-AND-GAS OFFERING FRAUD AND RELATED MARKET MANIPULATION SCHEME
A release on Mondo Visione on 14 April advised that the defendants are said to have raised more than $16 million from more than 300 investors through an unregistered private placement of the common stock a Dallas-based company that claimed to be focused on the oil and gas industry. However, it is alleged that, instead of using investors’ money to capitalise the company, they misappropriated millions of dollars raised in the offering, using the funds to pay for luxury goods, rental apartments, a car, and to make cash payments to friends, family members, and girlfriends.
THE SWISS INVESTIGATION OF THE LONGTIME HEAD OF LEBANON’S CENTRAL BANK
On 14 April, L’Orient Today carried an article saying that, in January, Switzerland requested legal assistance from Lebanon in an investigation into “money laundering to the detriment of Banque du Liban”. In response, Lebanon’s chief prosecutor questioned Riad Salameh, who denied any wrongdoing. The article says that items mentioned in the Swiss request raise several questions. According to sources, the investigation is into the alleged payment of more than $330 million in brokerage fees between 2002 and 2014 by the governor to a company registered in 2001 in the BVI, whose beneficiary owner is Raja Salameh, the governor’s younger brother, and related matters.
ODEBRECHT IN PANAMA
On 14 April, La Prensa in Panama published (in Spanish) what it described as a review of facts and works that marked his time in Panama, while the Public Prosecutor’s Office begins the process of delivering the result of its investigations.
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