OTHER THINGS YOU MAY HAVE MISSED – MAY 26

Panama Covid-19 update – while numbers of new infections continue at a worryingly (relative) high level, with 663 more reported today, together with 4 more fatalities, numbers in ICU, other hospital wards and hotel rooms have all fallen. There are now 5,961 active cases, with 46 in ICU and 360 in other wards.

Any modest contributions for my time and ongoing expenses are welcomed!  I have a page, where contributions start as low as $3, at https://www.buymeacoffee.com/KoIvM842y

26 MAY 2021

FUGITIVE INDIAN BUSINESSMAN MEHUL CHOKSI GOES MISSING

On 26 May, Business Standard reported that fugitive businessman Mehul Choksi, wanted in connection with the Punjab National Bank case, has gone missing in Antigua and Barbuda where he had been staying since January 2018.

https://www.business-standard.com/article/current-affairs/fugitive-businessman-mehul-choksi-goes-missing-says-antiguan-police-121052500163_1.html

UK: PROPOSAL TO PROPOSE BLOCKING LONDON LISTINGS OVER NATIONAL SECURITY AND DIRTY MONEY CONCERNS

On 26 May, KYC 360 reported that Chancellor Rishi Sunak is preparing to lay out plans to block companies from listing on the London Stock Exchange on national security grounds amid growing fears of businesses being backed by “dirty money”.  It is said that he plans to launch a consultation, with proposals for stricter rules on flotations.

https://www.riskscreen.com/kyc360/news/uks-sunak-to-propose-blocking-london-listings-over-national-security-dirty-money-concerns/

REPORT: CHINESE SURVEILLANCE-GEAR MAKER HIKVISION HAS TIES TO COUNTRY’S MILITARY

On 25 May, the Wall Street Journal reported that the world’s largest maker of surveillance equipment has long-established links to China’s military, including conducting a study with Chinese weapons experts and supplying cameras and drones to the country’s air force, according to a report by a surveillance-industry research company.  This comes as the company has launched legal action in the US to be removed from a sanctions list, disputing such connections.

https://www.wsj.com/articles/chinese-surveillance-gear-maker-hikvision-has-ties-to-countrys-military-report-says-11621941983

Meanwhile –

INVESTMENT BAN ON COMMUNIST CHINESE MILITARY COMPANIES CONTINUES TO EVOLVE

On 21 May, an article from Venable LLP says that anticipated clarifying guidance on the current ban on new US investment in certain Communist Chinese military companies (CCMC) is now postponed until 11 June. 

https://www.venable.com/insights/publications/2021/05/investment-ban-on-communist-chinese-military

US: RECOMMENDATION THAT 2 FORMER DEUTSCHE BANK TRADERS CONVICTED OF MANIPULATING PRECIOUS-METALS PRICES SHOULDN’T GO TO PRISON

On 25 May, the Wall Street Journal reported that probation officers made the recommendation and sparking a backlash from prosecutors who sought terms of almost 5 years or more.  A federal jury in September convicted James Vorley and Cedric Chanu of wire fraud over their trading of gold and silver on futures exchanges operated by CME Group Inc.

https://www.wsj.com/articles/traders-shouldnt-get-prison-time-in-spoofing-case-probation-office-says-11621971055

UK: HOUSE OF LORDS REPORT HIGHLIGHTS BENEFITS AND COSTS OF GAMBLING REFORM

On 25 May, iGB reported that a series of gambling regulatory reforms put forward by a House of Lords group Peers for Gambling Reform could reduce industry profits by as much as £974 million – but lead to a significant uptick in tax revenue and funding for research, education and treatment.

https://igamingbusiness.com/lords-report-highlights-benefits-and-974m-costs-of-gambling-reform

EFFICIENT, EFFECTIVE ONBOARDING – THE FIRST STEP IN THIRD-PARTY RISK MANAGEMENT

Refinitiv has published a white paper based on responses to a survey conducted in 2020.  It says that irresponsible actions or lack of oversight when onboarding a third party can expose a company to the risk of enforcement action, penalties and/or cause reputational damage.  Refinitiv asked respondents how essential a third-party compliance onboarding process is to their companies. Nearly 70% of the respondents agreed that it is very essential. We also asked legal experts and business decision makers 25 compelling questions about key aspects of their third-party onboarding and risk management processes, and many interesting trends emerged, which we detail in the following pages.

https://resourcehub.refinitiv.com/436593globalthirdpartyrisk/436593-3PR-BlogEffectiveOnboarding?

SIPRI MAP OF MULTILATERAL PEACE OPERATIONS 2021

The Stockholm International Peace Research Institute said on 25 May that there were 62 multilateral peace operations active in 2020, one more than in 2019.  The largest share of these (21 of them) were conducted by the UN.  Regional organizations such as the African Union and the EU and alliances (such as NATO) together conducted 36 operations.  Ad hoc coalitions of states conducted 5 peace operations in 2020.

https://www.sipri.org/commentary/topical-backgrounder/2021/multilateral-peace-operations-2020-developments-and-trends

LEGAL DUE DILIGENCE

On 24 May, an article from Maltese law firm Fennech & Fennech explains that legal due diligence is an exercise by virtue of which legal risks are evaluated during a merger or acquisition transaction.  Typically this is based on a review of documents belonging and related to an entity which is the target of an acquisition.  The firm says it is normally limited to a review of available documents. It is therefore commonly referred to as a “Documents Only” due diligence.  It requires the legal professionals to gather, comprehend and gauge the legal hazards, if any, related to a prospective acquisition.

https://fenechlaw.com/legal-due-diligence/

THE ROYAL COURT OF JERSEY HAS MADE A NEW LAW TO VARY THE TITLE TO SHARES IN A COMPANY WHICH HAD PASSED BY WAY OF SURVIVORSHIP TO THE SURVIVING JOINT OWNERS

On 24 May, an article from Carey Olsen advised that the Royal Court of Jersey has made new law by using a statutory power to vary the title to shares in a Jersey company which had passed by way of survivorship to the surviving joint owners. It is said that the judgment provides helpful clarification of the width of this statutory power and will be a useful precedent for similar cases in the future.

https://www.careyolsen.com/briefings/jersey-court-varies-title-jointly-owned-shares

MALI STRONGMAN OUSTS TRANSITIONAL LEADERS AS FRANCE WARNS OF SANCTIONS

On 25 May, Eye Witness News reported that Assimi Goita, who headed a junta which seized power less than 10 months ago, said that transitional President Bah Ndaw and Prime Minister Moctar Ouane had been stripped of their powers, and he promised elections in 2022.  Ndaw and Ouane have been heading an interim government that was installed in September under the threat of regional sanctions.  France warned of sanctions as a reaction.

https://ewn.co.za/2021/05/25/mali-strongman-ousts-transitional-leaders-as-france-warns-of-sanctions

MONEYVAL FINDS NO SIGNIFICANT AML IMPROVEMENT IN ALBANIA

On 26 May, Exit News reported the Albania has failed to significantly improve measures to combat money laundering and terrorist financing in line with FATF Recommendations.  Following an assessment made in 2018, a number of issues and deficiencies in tackling financial crime were noted, and Moneyval now says that limited steps have been taken to improve compliance with Recommendations, but gaps remain.

https://exit.al/en/2021/05/25/moneyval-finds-no-significant-anti-money-laundering-improvement-in-albania/

AML/CFT NATIONAL, REGIONAL AND SUPRANATIONAL RISK ASSESSMENTS

On 25 May, FATF published the links to various national risk assessments, plus a regional risk assessment for South Asia and Australia, the EU and the 2017 GAFILAT assessment for Latin America.

https://www.fatf-gafi.org/publications/methodsandtrends/documents/ml-tf-risks.html

WHAT DO THE NEW EU VAT RULES MEAN FOR ONLINE SELLERS?

On 26 May, Drapers reported that complex new EU VAT rules for UK retailers and digital marketplaces – for online direct-to-consumer transactions – come into force on 1 July.   The article explains the changes and how fashion businesses can prepare.

https://www.drapersonline.com/insight/what-do-the-new-eu-vat-rules-mean-for-online-sellers

KEY FEATURES OF THE UK’S EXPORT CONTROL AND SANCTIONS LICENSING REGIME

On 26 May, a post from UK Finance says that the UK’s post-Brexit autonomous sanctions framework under the Sanctions and Anti-Money Laundering Act 2018 has introduced a ream of changes to the sanctions landscape.  The sanctions previously introduced via EU Regulations were transposed into law through regulations made under the Act.  However, it says, one area of change which has flown somewhat under the radar is licensing, saying that there are important points to note about the UK’s SAMLA licensing regime.

https://www.ukfinance.org.uk/news-and-insight/blogs/key-features-uk-export-control-and-financial-sanctions-licensing-regime

MOLDOVA: VETERINARIAN ARRESTED IN CORRUPTION CASE INVOLVING SANITARY CERTIFICATES

On 26 May, the IPN news agency reported that another veterinarian of the Chisinau Food Safety Division had been arrested by anti-corruption officers. He is being investigated for acts of corruption in the case concerning the illegal issuing of sanitary veterinary certificates and was remanded in custody.

https://www.ipn.md/en/one-more-veterinarian-arrested-in-case-of-sanitary-certificates-7967_1081894.html#ixzz6vycANMea

BAHAMAS: BRITISH MAN ACCUSED OF FRAUD AND MONEY LAUNDERING REMANDED TO PRISON

On 26 May, the Nassau Guardian reported that prosecutors allege that Shane Ian Murphy obtained a Bahamian passport, National Insurance Board smart card and Bahamian driver’s licence in the name of Shane Harrington through fraud by false pretenses in 2020.  He was further accused of laundering €398,000 between November 2019 and February 2020.

https://thenassauguardian.com/british-man-accused-of-fraud-and-money-laundering-remanded-to-prison

CARGO CRIME RISKS INCREASING AND EVOLVING

On 26 May, Lloyds Loading List reported that cargo crime risks are rising and evolving, with insurance specialists highlighting higher risks associated with the current supply chain disruptions and highly organised criminal gangs targeting goods that are in market demand – including, increasingly, lower-value goods that are easily sold.  It is reported that freight insurance and risk management specialist TT Club said that it is launching a series of 6 podcasts to draw attention to the variable and complex nature of these risks and offer increased guidance on loss prevention.  Among identified trends apparent during the recent lockdowns has been a move away from the theft of higher value, more easily traced goods, such as electronics and domestic appliances, to food and drink commodities that have had a ready market.

https://www.lloydsloadinglist.com/freight-directory/news/Cargo-crime-risks-increasing-and-evolving/79167.htm#.YK5Mg42SmM8

https://www.ttclub.com/loss-prevention/supply-chain-security/

OECD WELCOMES COSTA RICA AS ITS 38th MEMBER

A news release from the OECD on 25 May announced that Costa Rica has now completed its domestic procedures for ratification of the OECD Convention and deposited its instrument of accession. This brings to a successful conclusion an accession process that began in April 2015.

https://www.oecd.org/newsroom/oecd-welcomes-costa-rica-as-its-38th-member.htm

NORTH KOREA REMAINS ON US LIST OF NON-COOPERATIVE COUNTRIES FOR ANTI-TERRORISM EFFORTS

On 26 May, KBS World reported that the US has designated North Korea a non-cooperative country in the global fight against terrorism for the 25th consecutive year.  The US restricts sales of arms and defensive services to those countries on the list

https://world.kbs.co.kr/service/news_view.htm

ENGLISH COURT HAS ‘BROAD JURISDICTION’ TO GRANT ACCESS TO DOCUMENTS

On 25 May, an article from Out-Law says that a recent decision by the High Court of England and Wales highlights the breadth of its jurisdiction to grant access to documents that have been referred to in a public hearing.

https://www.pinsentmasons.com/out-law/news/english-court-broad-jurisdiction-access-documents

LESSONS FROM SOUTH AFRICA’S STATE CAPTURE COMMISSION: THE IMPORTANCE OF WHISTLE-BLOWERS AND THEIR PROTECTION

On 25 May, an article from Control Risks says that the Judicial Commission of Inquiry into Allegations of State Capture is a public inquiry launched in 2018 to “investigate allegations of state capture, corruption, fraud and other allegations in the public sector including organs of state” in South Africa.  The article explores the work of some of the whistleblowers and how their lives have been affected since stepping forward.  It also looks at the protections available to whistleblowers in South Africa, and explains how and why companies should focus on creating environments conducive to whistleblowing.  It concludes that history has shown that protecting whistle-blowers and providing them with safe spaces to come forward is critical in the fight against corruption, whether on a national scale  or on a smaller scale within individual organisations.

https://www.controlrisks.com/our-thinking/insights/lessons-from-south-africas-state-capture-commission

HOPE, AND DELUSION, IN LIBYA’S NEW TRANSITION

On 24 May, an article from Control Risks looks at Libya, where a UN-brokered political process led to a ceasefire and the formation of the Government of National Unity (GNU).  It warns that foreign businesses – particularly in strategic sectors such as oil and power generation – will still have to navigate complex and fluid security, political and regulatory environments, although it says that  Libya is at its most stable moment since 2014, when civil conflict escalated and the country’s political institutions split.  It says that political and security developments in recent months offer a glimmer of hope that Libya can move on from the turbulent past decade, but nonetheless, numerous issues remain unresolved and could manifest as spoilers in the coming year, which calls for a cautious optimism. 

https://www.controlrisks.com/our-thinking/insights/hope-and-delusion-in-libyas-new-transition

MAFIA BOSS CLAIMS VENEZUELA-TURKEY COCAINE CONNECTION

On 26 May, Insight Crime reported that a Turkish mafia boss has alleged that a plan was set in motion to traffic cocaine from Venezuela to Turkey, opening up a new supply route.  The claims come from convicted Turkish gang leader Sedat Peker claimed Erkam Yildirim – the son of former Turkish prime minister Binali Yildirim had been involved.  Other claims made by Peker included that cocaine arriving in Turkey may be transferred to yachts heading to the Yalıkavak Marina in the port city of Bodrum.  The article notes that in 2019 Europol and the European Monitoring Centre for Drugs and Addiction (EMCDDA) reported that Turkish organized crime groups are increasingly setting up their own operations to transport cocaine directly from South America to Europe.

https://insightcrime.org/news/mafia-venezuela-turkey-cocaine/

PODCAST: THE EU VAT E-COMMERCE PACKAGE – A GAME CHANGER FOR THE DIGITAL ECONOMY?

On 26 May, Dentons published a podcast discusses the new VAT e-commerce rules that will come into force as of 1 July.  It is said that a broad range of companies will be touched by the changes, especially those with a business model focused on the B2C cross-border sale of goods – whether shipped within the EU or from non-EU to EU.  These can be, for example, consumer goods manufacturers selling online, online platforms, electronic interfaces or logistics service providers, even if they do not legally obtain ownership of the goods.

https://www.dentons.com/en/insights/videos/2021/may/26/the-eu-vat-e-commerce-package-a-game-changer-for-the-digital-economy

HUMAN RIGHTS WATCH AND NGO CALL ON THAI COMPANY TO BACK OFF ON MYANMAR OIL DEALS

On 26 May, Radio Free Asia reported calls for Thailand’s state-owned oil and gas company to not expand business ties with Myanmar’s junta while the Burmese military carries on with a bloody post-coup crackdown on protesters.  Petroleum Authority of Thailand (PTT) has been involved in oil and gas exploration in Myanmar for more than 3 decades. 

https://www.rfa.org/english/news/myanmar/deals-05252021180123.html

ARE GOLDEN VISAS A GOLDEN OPPORTUNITY FOR ECONOMIC DEVELOPMENT?

On 26 May, a post on the LSE Business blog posed this question, saying that such programmes are likely to become more attractive for countries searching for a shot of foreign investment to recover from the COVID-19 crisis. Looking at the EU, it says that they typically bring in no more than 0.3% of GDP in revenues and aren’t large enough to make a difference in real estate markets, except for Greece. Half of all EU member states, along with the UK, hosts “golden visa,” or “residence by investment” (RBI) programmes, which offer residence permits to investors. 

https://blogs.lse.ac.uk/businessreview/2021/05/26/are-golden-visas-a-golden-opportunity-for-economic-development/

https://www.tandfonline.com/doi/epub/10.1080/1369183X.2021.1915755?needAccess=true

PODCAST: FRAUDULENT VACCINATION CARDS

In the latest TRACE podcast, Hayley Smith of the Los Angeles Times discusses the story she broke about the sale of phony COVID-19 vaccination cards out of the Old Corner Saloon in California.

https://www.traceinternational.org/resources-podcast

ISLE OF MAN AML LAW AND REGULATIONS

The International Comparative Legal Guides has published an updated guide provided by DQ Advocates in the Island.

https://iclg.com/practice-areas/anti-money-laundering-laws-and-regulations/isle-of-man

DISRUPTING TRANSNATIONAL CRIMINAL ACTIVITY: A LAW ENFORCEMENT STRATEGY FOR US HOMELAND SECURITY

On 21 May, the Belfer Center published a Paper which proposes that the US Department of Homeland Security (DHS) take the lead in supplementing the traditional “criminal justice” approach to countering transnational crime with strategies that aim to disrupt it and insulate Americans from its harmful effects.  Saying that many types of transnational crime are resistant to the law enforcement tactics used domestically, it contends that the “Disruption Model”, if broadly implemented, could significantly complement the current conventional approach, and produce materially improved results in managing the challenges of transnational crime and protecting the homeland from its ravages.

https://www.belfercenter.org/sites/default/files/files/publication/HSP9-draft2.pdf

UK: THE SCOPE OF 2 OPEN GENERAL EXPORT LICENCES (OGEL) ON INFORMATION SECURITY ITEMS REVIEWED

On 26 May, a Notice to Exporters from the Department for International Trade advised that 2 OGEL dealing with the export of information security items had been reviewed.  The purpose of these licences is to allow the export of ‘low-risk’ information security items deploying encryption to a wide range of destinations, and have been amended to include China, Hong Kong and Macao as permitted destinations although this has been balanced by a reduced list of permitted items.

https://www.gov.uk/government/publications/notice-to-exporters-202103-information-security-items-update/notice-to-exporters-202103-information-security-items-update

IMPOSE TAX ON INCREASING PRIVATE JET USE TO FUND GREEN FLYING, SAYS REPORT

On 26 May, the Guardian reported that a report from campaign group Transport & Environment said that carbon emissions from private flights rose by 31% from 2005-19, the report says, and private aviation had rebounded to pre-pandemic levels by August 2020, when 60% of public flights were grounded.  It also says that travelling by private jet is the most polluting activity an individual can undertake, the report says, with 4 hours of flying equivalent to the total annual emissions of the average European citizen.  The report calls for wealthy fliers to pay ticket taxes of €325 million a year to fund the acceleration of zero-carbon aviation technology

https://www.theguardian.com/business/2021/may/26/climate-ticket-tax-private-jet-users

FIGHT AGAINST ORGANISED CRIME: EU COUNCIL SETS OUT 10 PRIORITIES FOR THE NEXT 4 YEARS

A news release from the EU on 26 May advised that the EU had adopted conclusions setting the 2022-2025 EU priorities for the fight against serious and organised crime through the European multi-disciplinary platform against criminal threats (EMPACT).  Within the EMPACT framework, EU Member States, agencies and other actors will work closely together to address these key criminal threats, using tools such as law enforcement training and joint operational actions to dismantle criminal networks, their structures and business models.  The 10 aims include to identify and disrupt high-risk criminal networks active in the EU, with special emphasis on those using corruption, acts of violence, firearms and money laundering through parallel underground financial systems; and to target criminals orchestrating fraud, economic and financial crimes, including online fraud schemes, excise fraud, missing trader intra-community fraud (MTIC fraud), intellectual property crime, counterfeiting of goods and currencies, criminal finances and money laundering.

https://www.consilium.europa.eu/en/press/press-releases/2021/05/26/fight-against-organised-crime-council-sets-out-10-priorities-for-the-next-4-years/

RISING EXPECTATION OF CASHLESS SOCIETY WORLDWIDE

On 26 May, a release on Mondo Visione advised that the second annual report from the Economist Intelligence Unit shows a growing acceptance of digital currencies, fuelled by Covid-19. 

https://digitalcurrency.economist.com/?utm_source=PR&utm_medium=MO&utm_campaign=crypto&utm_content=report

https://mondovisione.com/media-and-resources/news/rising-expectation-of-cashless-societies-worldwide-a-second-annual-report-by/

PODCAST: NEW METHODS OF PAYMENT AND FINANCIAL CRIME

A podcast from RUSI says that the emergence of new financial services and methods of payment has brought greater variety and choice, but as with many innovations, the advantages have not been lost on criminal groups.  The podcast considers the current financial threat landscape in relation to new methods of payment, how money laundering can be detected, and priorities and best practices for managing exposure.

https://www.rusi.org/multimedia/new-methods-payment-and-financial-crime

Any modest contributions for my time and ongoing expenses are welcomed!  I have a page, where contributions start as low as $3, 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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