Panama Covid-19 update – firstly, a less than cheery note, as La Prensa reports that the Directorate General of the Social Security (CSS) sent an internal memorandum for the system to “prepare for a possible increase in cases” of Covid-19 in the country; with hospital occupancy at around 50%, although there a few places, such as in Chiriquí and Bocas del Toro, where cases are beginning to increase discreetly.
Meanwhile, numbers creeping up again…with 356 new cases reported today and 4 new fatalities. There are 3,895 active cases, of whom 60 are in ICU and 307 in other wards.
5 MAY 2021
ALLEGED ‘INDIRECT BRIBES’ TO FAMILY MEMBERS OF OFFICIALS IN LA CITY HALL CORRUPTION CASE
On 4 May, KYC 360 reported that, when the U corruption case targeting Los Angeles City Hall first broke into view, much of the public’s attention focused on vivid descriptions of cash bribes, escort services and lavish trips to Las Vegas. But federal prosecutors have laid out another, less sensational set of allegations: that a deputy mayor-turned-real estate consultant worked to arrange “indirect bribes” for city officials by routing the money through those officials’ family members. Experts say indirect bribes can be more difficult to uncover than a typical quid pro quo in which someone gives money directly to a government official.
SFO INVESTIGATORS DROP PROBE OF INDIVIDUALS IN AIRBUS BRIBERY CASE
On 5 May, KYC 360 reported that prosecutor has closed an investigation into individuals over bribery at Airbus SE after a settlement last year saw Airbus pay a record $4 billion.
ASIA’S MULTIBILLION DOLLAR METHAMPHETAMINE CARTELS ARE USING CREATIVE CHEMISTRY TO OUTFOX POLICE
On 4 May, CNN reported that authorities seized a record 175 tons of meth in 2020 throughout East Asia and Southeast Asia, a new record despite the Covid-19 pandemic, according to preliminary UNODC data. But seizures of ephedrine, pseudoephedrine and phenyl-2-propanone (P2P) – the most common chemicals used to make meth – basically dried up. This is said to leave experts with a puzzling question: How was the meth being made? The chemicals are referred to as “pre-precursors” or “non-scheduled-precursors”, and are made and sold legally but diverted for illicit use at some point in the supply chain. It says that pre-precursors are a global problem, with the increasing use of pre-precursors described as a critical challenge to the international drug control system. These issues are more acute in Asia because the illicit drug production centres in the Golden Triangle operatenext door to 2 of the world’s biggest chemical and pharmaceutical manufacturers, China and India, offering ready access to licit chemicals that can be used for illicit means.
US SANCTIONS ON RUSSIA TO HAVE LIMITED IMMEDIATE IMPACT BUT ADD TO POLITICAL, CONTRACT RISKS FOR BUSINESS
On 21 April, Control Risks published an article arguing that coverage understates a new and more significant sanctions reality for companies and investors involved or interested in Russia. It describes a sanctions grey zone for international companies and investors operating in Russia, or for investors considering technology sector targets outside Russia that might have connections to Russian counterparts. It says that companies and investors will need to conduct careful analysis of their current and future sanctions risk exposure when considering their Russian partners or indeed non-Russian investment targets with connections to Russia.
MALTA GAMBLING OPERATORS FAILING TO COLLECT EFFECTIVE AML DATA
On 5 May, iGB reported that the FIAU has warned that too many remote gaming operators only collect data that “add no value” for some high-risk players in conducting AML checks. All sectors, including remote gaming, saw an increase in suspicious transaction reports related to money laundering in recent years, and gambling was listed alongside banking as the 2 “main contributors” of STR. The FIAU says that investigations into gaming operators found that these operators often only gathered details that “add no value” in building a customer’s profile, such as simply stating that the customer is employed.
GAMBLING TRADE BODY EGBA CLAIMS “PUNITIVE” GERMAN TURNOVER TAX VIOLATES EUROPEAN LAW
On 4 May, iGB reported that the European Gaming and Betting Association (EGBA) has argued Germany’s proposed 5.3% turnover tax for online casino would not only push players to unlicensed operators, but is also in violation of EU law.
CELL COMPANIES IN GUERNSEY
Carey Olsen has published 2 articles on 4 May about Protected Cell Companies (PCC) and Incorporated Cell Companies (ICC) in Guernsey. Guernsey introduced legislation permitting the formation of cell companies through the Protected Cell Companies Ordinance in 1997 – the first country in the world to do so. A PCC is a single legal entity. It is one company with one board of directors, one memorandum and articles of incorporation and one company registration number, and it comprises a core and any number of cells. An ICC is based on the same principles as the PCC: segregation of assets and limited recourse of creditors to specified pools of assets rather than to all of the assets of the company – but each incorporated cell of an ICC is a separately registered legal entity with its own memorandum and articles of incorporation, its own company registration number and its own board of directors.
KIM KARDASHIAN ORDERED TO REPATRIATE ANCIENT ROMAN STATUE OF ATHENA
On 5 May, the Art Law & More blog from Boodle Hatfield reported that she must forfeit an ancient Roman sculpture, according to a recent civil forfeiture action filed by the US Government. In 2016 Kardashian acquired the piece from an art dealer’s Belgium gallery, although authorities believe she was unaware of its dubious origins.
EUROPEAN AND UK CRITICAL RAW MATERIALS (CRM) SUPPLY CHAINS – “NATIONAL SECURITY” CONSIDERATIONS
On 3 May, an article from Vivien & Associés in France considers the impact of the national security aspects of the foreign investment policies of the UK and the EU. The Covid pandemic has shone a spotlight on global supply chains and their “resilience” in the face of diverse disruptions such as lockdown and quarantine, confirming the truth of the aphorism that “a chain is no stronger than its weakest link”.
NORTH KOREA CONTINUES TO BUILD UP CHEMICAL AND BIOLOGICAL WEAPONS
On 5 May, the Korea Herald and others reported that North Korea continues to build up its chemical and biological weapons, in addition to its other WMD such as nuclear weapons that pose a serious threat to US forces and South Korean allies, a ranking US official has said – and that Kim Jong-un may actually use such weapons in case of a conflict on the Korean Peninsula. The US Department of Defense official named China as one of the largest sources of chemical and biological weapons materials for North Korea and others. In 2020, the US Army estimated the North had up to 5,000 tons of chemical weapons of approximately 20 different types, making it the third-largest possessor of chemical agents in the world.
LAW ON PERSONAL DATA PROTECTION IN PANAMA HAS COME INTO FORCE
On 4 May, Nearshore Americas reported that, on 29 March, the long-awaited Law 81 on Personal Data Protection in Panama, originally passed in 2019, came into force. Like recent regulations on data protection in Latin America, Panama’s Law 81 was noticeably influenced by the European regulatory model and includes some of the innovations from the GDPR.
CFIUS DOES NOT MEAN CHINESE COMPANIES CAN’T INVEST IN THE US
On 5 May, Technode reported that the US government’s Committee on Foreign Investment in the United States (CFIUS) has steadily increased its scrutiny of Chinese investment in US businesses. Recent changes to US laws, including the Foreign Investment Risk Review Modernization Act (FIRRMA), have expanded CFIUS’s ability to block investments that it deems a threat to US national security – but this does not mean CFIUS will block all such transactions: in fact, the majority are still approved.
SWEDEN: SWEDBANK FINED OVER HISTORIC AML FAILURES
On 5 May, LSM and others reported that the Disciplinary Committee at Nasdaq Stockholm has ordered Swedbank to pay a fine of 12 annual fees, equivalent €4.57 million over historic failures in the field of AML measures linked to its Baltic operations.
SOUTH AFRICA: FUGITIVE BOBROFF LAWYERS GET BACK SOME OF MONEY FORFEITED TO STATE
On 5 May, IOL reported that former personal injury lawyers Ronald Bobroff and his son Darren – who fled to Australia in 2016 – have seen the Supreme Court of Appeal order that slightly over R7 million of the more than R100m which was earlier forfeited to the State be handed back to them. They had challenged the forfeiture of money said to be hidden in bank accounts in Israel. In 2010, allegations began to surface that their firm had over the preceding 3 years charged clients inflated fees.
MILITANTS ATTACK OIL WELLS IN IRAQ’S NORTH BUT PRODUCTION UNAFFECTED
On 5 May, Defence Web reported that militants using bombs attacked 2 oil wells at an oilfield close to the northern Iraqi city of Kirkuk. Industry sources said the attack had not affected production. A statement from the oil ministry did not comment on production.
UK: IMPORTS OF FIREARMS & AMMUNITION IMPORT LICENSING ARRANGEMENTS 2020
UK Notice to Importers 2944 of 1 April e sets out the licensing arrangements for imports of firearms and ammunition into the UK. It replaces all previous Notices to Importers on this subject and has been updated to reflect the firearms import licensing regime when the UK left the EU whilst detailing the impact of the Northern Ireland Protocol for imports into Northern Ireland.
UK IMPORT CONTROLS
On 5 May, the Depart of International Trade published updated information and including reference to revised rules for the import of firearms.
NEW ACTION AT EU LEVEL AGAINST ‘NDRANGHETA IN ITALY AND GERMANY
On 5 May, a news release from Europol advised that Eurojust and Europol have supported the competent Italian and German authorities with the arrest of 31 suspects in both countries, alleged to be part of the ‘Ndrangheta mafia, operating in different regions of Italy and abroad. Further to this, in the context of a joint investigation team (JIT) between Italy and Germany, 65 other suspects have been identified and their places were searched during a large-scale action, for which around 800 police officers and tax officials were deployed in both countries.
US CUSTOMS SEIZES TOP GLOVE PRODUCTS UNDER FORCED LABOUR FINDING
A news release from US Customs & Border Protection on 4 May advised that officers in Cleveland seized a shipment of 3.97 million nitrile disposable gloves due to information indicating they were made by forced labour, a form of modern slavery. It reminds one that in March, CBP directed personnel at all US ports of entry to begin seizing disposable gloves produced in Malaysia by Top Glove.
VENEZUELA’S MODELLING AGENCIES REPEATEDLY LINKED TO HUMAN TRAFFICKING
On 5 May, Insight Crime reported that, as sex trafficking has soared in Venezuela, seemingly legitimate modelling agencies are repeatedly being linked to cases of human trafficking, often sending women abroad. A recent case is not the first time that Venezuelan modelling agencies have been linked to alleged prostitution and sex trafficking, including involvement with organised crime groups and government officials.
SWITZERLAND: ABOLITION OF THE BEARER SHARE – STATUS QUO AND RECOMMENDATIONS FOR ACTION
On 3 May, an article from Eversheds Sutherland reminded one that companies had until 30 April to convert remaining bearer shares into registered shares or to register a remark in the commercial register explaining why such a conversion is not necessary. Holders of bearer shares whose shares were converted had until that date to disclose their identity to the company in order to be registered in the company share register. Those who have failed to do so before this date can now be registered under stricter conditions only until 31 October 2024, and those who miss this deadline risk having their shares declared null and void and converted into the company’s own shares.
PHILIPPINES DETAINS 48 UNDOCUMENTED CHINESE WORKING AT STEEL PLANT
On 4 May, Radio Free Asia reported that Philippine authorities had detained the Chinese nationals who were working at a steel plant in the southern Philippines without proper papers, in the latest round-up of undocumented workers in the country. The raid was part of a nationwide crackdown on undocumented foreigners. More than 200,000 Chinese workers are employed mostly in the Philippine gaming industry, according to official statistics – but the figure could be much higher because it is said that some airport and immigration officials allegedly accepted bribes to allow Chinese nationals in.
US: PHARMACEUTICAL COMPANY HAS AGREED TO PAY $12.6 MILLION TO RESOLVE ALLEGATIONS THAT IT VIOLATED THE FALSE CLAIMS ACT BY PAYING KICKBACKS
A news release from US DoJ on 4 May advised that the pharmaceutical company headquartered in Delaware, Incyte Corporation, purportedly used an independent foundation as a conduit to pay the co-pays of certain federal beneficiaries taking Incyte’s drug Jakafi, which was approved to treat myleofibrosis in 2011.
MALTA: FIAU ENFORCEMENT FACTSHEET
On 4 May, the Financial Intelligence Analysis Unit (FIAU) in Malta published this factsheet in a bid to provide more insights on AML/CFT compliance trends. The Enforcement Section of the FIAU has analysed the enforcement actions undertaken in 2019 and 2020 and produced this factsheet which presents the conclusions of this analysis. It is said to provide insights into the most common observations which emanated from the AML/CFT supervisory visits.
UK GOVERNMENT “MAKES PROGRESS” ON ECONOMIC CRIME PLAN TO TACKLE FRAUD AND ECONOMIC CRIME
A news release on 4 May from the Home Office and HM Treasury contained a statement of progress shows improved understanding of threat and how the UK Government is investing in the law enforcement response to economic crime. The Economic Crime Plan was launched in 2019 and set out an ambitious programme of work to tackle fraud and money laundering and set out how the UK’s public and private sectors would work together to improve the response to economic crime.
NGO CALL ON US TO ASSIST HAITIAN GOVERNMENT IN FIGHTING CORRUPTION
On 4 May, Global Financial Integrity published an open letter from a number of NGO to the US Secretary of State saying that the recent violent protests in Port-au-Prince underscore the Haitian people’s acute frustration with weak democratic governance, systemic corruption and the severe poverty that results from the avarice of government officials. It calls on the Biden Administration to play a convening role by establishing a “Haiti Cooperation Group” (HCG) which would bring together multilateral institutions, donor countries and like-minded governments in the region.
PODCAST: MADOFF AND BELFORT: IKE SORKIN
In the latest TRACE podcast, Ike Sorkin, lawyer to both Bernie Madoff and Jordan Belfort, talks through their criminal financial schemes and how regulatory safeguards failed (This episode was originally published in June 2017).
UK: JUDGE CONDEMNS ‘REPREHENSIBLE’ BARCLAY OVER MONEY DISPUTE WITH ESTRANGED WIFE
On 5 May, the Belfast Telegraph reported on the outcome of the bitter divorce battle involving Sir Frederick Barclay, 86, one of a famous pair of twins who owned the Daily Telegraph and the Ritz, amongst other things. The judge said that Barclay sold a luxury yacht and “applied the equity for his own use” in breach of orders, and described his actions as “reprehensible”. A ruling sees the ex-wife receive £100 million (she wanted £120 million), though Sir Frederick had made an offer which might have led to Lady Barclay receiving nothing, and this after a 34-year marriage.
DATA PROTECTION NEWS UPDATE
On 5 May, Field Fisher published the April edition of its Data Protection Times containing the latest updates from the data protection world, from its Privacy, Security and Information law team. It includes news on the question of adequacy for the UK vis a vis the EU on the transfer of personal information, with a review expressing some concerns, such as how the UK’s legal system will evolve, aspects of onward transfers and the mention and analysis of the term “lawful interception”. This has resulted in a request for an extension of time for MEPs to review the opinions and make a ruling.
DRAFT LEGISLATION FROM THE EUROPEAN COMMISSION SHOWS THE COMING AI LEGAL LANDSCAPE
On 5 May, the Compliance & Enforcement blog from the Program on Corporate Compliance and Enforcement from the New York University School of Law published Part III of a 5-part series by the authors on The Future of AI Regulation. Part I discussed US banking regulators’ recent request for information regarding the use of AI by financial institutions; and Part II outlined key features of the EU’s draft AI legislation – which is discussed further in this Part.
LOW INCOMES TAX REFORM GROUP (LITRG) RESEARCH REPORT LOOKING AT THE USE OF ‘UMBRELLA’ COMPANIES
Politics UK reported that, in a 150-page report issued on 6 April, LITRG takes a deep dive into the world of labour market intermediaries in the UK, with a large focus on umbrella companies. The report explores the benefits and complexities of umbrella companies. It also explores other types of labour market intermediaries and the use of disguised remuneration schemes which are used to pay workers instead of traditional wages.
ROYALTY PROPOSAL PUTS HALF OF CHILE’S COPPER MINES AND 25% OF OUTPUT AT RISK
On 5 May, Metal Bulletin reported that the head of mining association Sonami has claimed that almost half of Chile’s copper mines could be forced to halt operations in the future due to higher production costs if a proposed law to increase royalty taxes on the metal is approved.
UK: A RECORD NUMBER OF FINANCIAL SCAMS ARE BEING UNCOVERED
On 5 May, This is Money reported that a total of 219 warnings about sham firms were issued by the FCA last month. It is believed to be the most of any month on record and was nearly double March’s figure of 114. The frauds include those which are illegally selling financial products such as bonds, foreign currency exchange and shares without authorisation, as well as those pretending to be legitimate businesses.
SYRIA’S RIFAAT AL-ASSAD: FROM ‘BUTCHER OF HAMA’ TO REAL ESTATE TYCOON
On 5 May, France 24 carried an article as the appeal of Rifaat al-Assad goes ahead in Paris. Syrian President Bashar al-Assad’s uncle was initially convicted of money laundering as part of an organised gang, embezzlement of public funds and aggravated tax evasion. The article looks back at the long career of this Assad dynasty scion who amassed a colossal European property empire. Heis accused of fraudulently building a French property empire estimated at €90 million.
FORMER MINISTER IN BARBADOS SENTENCED 2 YEARS IN US PRISON
On 5 May, TeleSUR reported that Barbados’ former minister of Industry and Commerce Donville Inniss has been sentenced to 24 months in a US Federal Prison on money laundering charges. He was sentenced for his role in a scheme to launder bribe payments from the Insurance Corporation of Barbados through banks in New York.
CLSA PREMIUM NEW ZEALAND LIMITED (CLSAP NZ) HAS ADMITTED TO BREACHES OF THE ANTI-MONEY LAUNDERING AND COUNTERING FINANCING OF TERRORISM (AML/CFT) ACT
On 5 May, a release on Mondo Visione reported that the regulator FMA had commenced proceedings in 2020 alleging CLSAP NZ failed to comply with its obligations under the AML/CFT Act between April 2015 and November 2018. CLSAP NZ, formerly KVB Kunlun New Zealand Limited, is the local subsidiary of the Hong Kong parent, CLSA Premium Limited. CLSAP NZ provides derivatives trading services and is licensed by the FMA as a derivatives issuer.
US COURT AUTHORISES “JOHN DOE” SUMMONS TO SEEK NAMES OF US TAXPAYERS WHO USED CRYPTOCURRENCY
A release on Mondo Visione on 5 May advised that a federal court has allowed the IRS to serve a John Doe summons on Payward Ventures Inc, and subsidiaries seeking information about US taxpayers who conducted at least the equivalent of $20,000 in transactions in cryptocurrency during the years 2016 to 2020. The IRS is seeking the records of Americans who engaged in business with or through Kraken, a digital currency exchanger headquartered in San Francisco.
WILL A NEW ANTI- PIRACY FRAMEWORK SOLVE THE GULF OF GUINEA’S PIRACY WOES?
On 4 May, Dryad Global posed this question, saying that the latest self-enforcing regional commitments aimed at improving maritime security in the Gulf of Guinea have been announced by the Inter Regional Coordination Centre Yaoundé (ICC) and the Nigerian Maritime Administration and Safety Centre (NIMASA).
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