OTHER THINGS YOU MAY HAVE MISSED – JUNE 6

Panama Covid-19 update – active cases continue to rise, now at 7,708; with 526 new cases reported today and 7 new fatalities. ICU numbers have dropped to 62, and 361 others are in other wards – but the number of those in so-called “hospital hotels” have risen from 385 to 399.

Just to add to the mix, the ministry of health has reported that 1,506 cases of malaria have been reported – the symptoms of which could be mistaken for the onset of Covid – chills, fever, headache, vomiting. Only 5 of the cases were reported in the metropolitan area. to cheer one further, iIf not treated quickly with effective medications, the disease can be serious and often fatal, the ministry has warned.

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6 JUNE 2021

ISLE OF MAN SEEKS FIRST AUDITOR GENERAL

On 2 June, the ICAEW reported that Tynwald, the parliament of the Island, is setting up an office of Auditor General to audit the Government and conduct value for money inspections.  The new post of Auditor General will be independent of Government and give oversight to parliament of a spend of about £1.4 billion, with an objective of trying to identify savings sufficient to cover its costs principally through value for money work in order to offset the £400,000 a year incremental cost of establishing the office.

https://www.icaew.com/insights/viewpoints-on-the-news/2021/jun-2021/isle-of-man-seeks-first-auditor-general

EL SALVADOR LOOKS TO BECOME FIRST COUNTRY TO ADOPT BITCOIN AS LEGAL TENDER

On 6 June, the Straits Times reported that El Salvador’s president, who is known to break from the norms, said he plans to send legislation that would make Bitcoin legal tender in the country, alongside the US dollar.  El Salvador is a largely cash economy, where 70% of the population does not have a bank account.  Money sent home by migrants, account for more than 20% of its GDP.

https://www.straitstimes.com/business/economy/el-salvador-looks-to-become-first-country-to-adopt-bitcoin-as-legal-tender

ISRAEL: POLICE INVESTIGATE SUSPICIONS OF CORRUPTION IN HEALTH MINISTRY

On 6 June, Arutz Sheva in Israel reported that suspects, including current and former public servants, manager of medical company and manager of lobbying company, have been detained.  It is said that a suspect was involved in seeking to promote and preserve the interests of large commercial companies in the economy, taking advantage of his status in complete conflict with the public interest.

https://www.israelnationalnews.com/News/News.aspx/307552

SOUTH AFRICA: GUPTA WHISTLEBLOWER BROKE AND CAN’T FIND WORK

On 6 June, The South African reported that, despite speaking out against corruption at Gupta-linked Trillian Capital, Bianca Goodson is struggling to find work and at her wits end. 

https://www.thesouthafrican.com/news/im-gutted-and-broken-gupta-whistleblower-broke-cant-find-work

FRANCE OPENS PROBE INTO LEBANESE CENTRAL BANK CHIEF’S WEALTH

On 6 June, RFI reported that France has opened a probe into the personal wealth of Riad Salameh, central bank chief in crisis-hit Lebanon, following a similar move by Switzerland.  He is suspected of transferring money abroad during a 2019 uprising, when ordinary people were prevented from doing so.

https://www.rfi.fr/en/france/20210606-france-opens-probe-into-lebanese-central-bank-chief-s-wealth-riad-salameh-economic-crisis-uprising-2019-corruption-money-laundering

IRELAND: CRIMINAL PROCEDURE ACT 2021 – BETTER CASE MANAGEMENT IN WHITE COLLAR CRIME?

On 2 June, McCann Fitzgerald reported that the Act was recently passed into law and awaits commencement, and makes a number of significant changes to criminal procedure including the introduction of preliminary trial hearings and the wider provision of documentation to juries to assist them with their deliberations.  The firm says that the introduction of provisions on preliminary trial hearings and the potential that this brings to reduce delay and improve efficiency will be welcomed.  This, it says, is particularly true where the pandemic has led to court closures and postponements.  It also says that the changes made are just one step in a series of promised reforms to strengthen the State’s capacity to prevent and prosecute this type of wrongdoing.

https://www.mccannfitzgerald.com/knowledge/disputes/Disputes-Criminal-Procedure-Act-2021-Better-Case-Management-in-White-Collar-Crime

IRELAND: NEW WHISTLE-BLOWING RULES ON THE HORIZON

On 24 May, an article from McCann Fitzgerald reported that a general scheme for an amendment to the Protected Disclosures Act 2014 has been published, to implement into Irish law the EU Whistleblowing Directive on the protection of persons who report breaches of EU law.  However, the proposed content of the planned Bill extends well beyond this.

https://www.mccannfitzgerald.com/knowledge/employment/employers-beware-new-whistle-blowing-rules-on-the-horizon

THE EU TAXONOMY REGULATION

On 24 May, an article from McCann Fitgerald explained that the EU Regulation, which entered into force in July 2020, sets out a classification system for environmentally sustainable economic activities and, in doing so, aims to create a common language to be used when assessing whether economic activities have a substantial positive impact on the environment.  The article refers to the additional Regulation (due to come into force from 1 January) which contains agreed technical screening criteria.  The latter includes matters included and excluded from the scope of the Regulations.

https://www.mccannfitzgerald.com/knowledge/sustainable-finance/eu-taxonomy-regulation-agreed-technical-screening-criteria-published

PODCAST – TAX FRAUD: THE RISE OF THE PROFESSIONAL ENABLER

On 24 May, RPC released a podcast involving an interview with Simon York, Director of HMRC’s Fraud Investigation Service (FIS).  Created only 5 years ago, FIS has already secured 3,700 criminal convictions for serious fraud and protected over £25 billion in assets.  In particular, he discusses how advice and assistance from professional enablers is becoming an increasingly vital element of tax fraud – and how FIS plans to counter it.

https://www.rpc.co.uk/perspectives/tax-take/tax-fraud-the-rise-of-the-professional-enabler/

THE ROLE OF BENEFICIAL OWNERSHIP IN COMBATING IUU FISHING

On 2 June, C4ADS called for the G7 Finance Ministers and Central Bank Governors meeting in London to endorse the adoption of global beneficial ownership registries to help end illegal, unreported, and unregulated (IUU) fishing and other forms of environmental crime that are enabled by complex corporate structures.  It argues that in the global fishing industry complex corporate structures enable companies to systematically exploit forced labour, corruption, tax evasion and fraud to make their margins and hide their ultimate beneficial owners.  It says that the value generated from IUU fishing is estimated to be between $10 billion and $36.4 billion annually, making it the third most lucrative natural resource crime after timber and mining. 

https://c4ads.org/blogposts/2021/6/4/the-role-of-beneficial-ownership-in-combating-iuu-fishing

RUSSIA CUTS DOLLAR HOLDINGS FROM $119 BILLION OIL WEALTH FUND AMID SANCTIONS

On 2 June, CNAS reported that Russia has said that it will eliminate the dollar from its oil fund to reduce vulnerability to Western sanctions. The National Wellbeing Fund will shift its dollar holdings into euros, yuan and gold, the finance minister has said.  The transfer will take place within the central bank’s huge reserves and affects about $119 billion in liquid assets, of which about a third is held in dollars.

https://www.cnas.org/press/in-the-news/russia-cuts-dollar-holdings-from-119-billion-wealth-fund-amid-sanctions

https://www.cnbc.com/2021/06/03/us-sanctions-may-see-russia-ditch-dollar-denominated-oil-contracts-novak-says.html

THE RISE OF CENTRAL BANK DIGITAL CURRENCIES

On 20 April, the Atlantic Council published an interactive map showing the status of CBDC programmes and plans in countries around the World.

https://www.atlanticcouncil.org/blogs/econographics/the-rise-of-central-bank-digital-currencies/

SECRECY AROUND ENCROCHAT CRYPTOPHONE HACK BREACHES FRENCH CONSTITUTION, COURT HEARS

On 4 June, Computer Weekly reported that French lawyers claim that investigators are unlawfully withholding details of a cryptophone hacking operation in a case that could impact UK prosecutions.  The Encrochat cases dating from April 2020 involved an operation that has led to hundreds of arrests in the UK and Europe for offences including drugs, firearms and money laundering.  More than 250 prosecutions that are under way in the UK, which rely on text messages and photos harvested from EncroChat phones by the French gendarmerie.  Under French law, prosecutors are required to provide an explanatory note about the hacking technique used and the progress of the operation; and a certificate of authenticity for the data used in evidence, but is is claimed that neither has been provided.

https://www.computerweekly.com/news/252501921/Secrecy-around-EncroChat-cryptophone-hack-breaches-French-constitution-court-hears

EGYPT SAID TO HAVE IMPROVED TOOLS OF COUNTERING MONEY LAUNDERING AND TERRORIST FINANCING CRIMES

On 6 June, an article in Al Ahram in Egypt reported claims that Egypt has improved the tools needed for countering the crime of money laundering and terrorist financing, according to the chairman of the Egyptian Money Laundering and Terrorist Financing Combating Unit (EMLCU).  EMLCU is an independent unit at the Central Bank of Egypt established in 2003. 

https://english.ahram.org.eg/NewsContent/1/64/413651/Egypt/Politics-/Egypt-improved-tools-of-countering-money-launderin.aspx

SIGNIFICANT CYBER INCIDENTS SINCE 2006

The Center for Strategic and International Studies has provided a timeline of significant cyber incidents since 2006, focused on cyber attacks on government agencies, defence and high tech companies, or economic crimes with losses of more than a million dollars.

https://csis-website-prod.s3.amazonaws.com/s3fs-public/210604_Significant_Cyber_Events.pdf?Ig0rKRzJ9Bc2WS95MJVt1pkZll5eJLE7 

EU IS SET TO UNVEIL PLANS FOR A BLOC-WIDE DIGITAL WALLET FOR ID, PAYMENTS AND PASSWORDS

Euronews and others reported that the EU is set to unveil plans for a bloc-wide digital wallet, following requests from Member States to find a safe way for citizens to access public and private services online.  The app will allow citizens across the EU to securely access a range of private and public services with a single online ID.

https://www.euronews.com/2021/06/02/the-eu-is-set-to-unveil-plans-for-a-bloc-wide-digital-wallet-for-ids-payments-and-password 

FATF PUBLISHED SECOND AML/CFT ASSESSMENT FOLLOW-UP REPORT

On 4 June, FATF published the follow-up report previously published by FATF-style regional body APG.

https://www.fatf-gafi.org/media/fatf/documents/reports/fur/APG-2nd-Follow-Up-Report-Pakistan-2021.pdf 

G7 DEAL: UK IS BADLY CONFLICTED BETWEEN OFFSHORE TAX HAVENS AND BIDEN’S GLOBAL TAX DRIVE

On 6 June, an article in The Conversation by an affiliate of the Tax Justice Network argues that, with Britain playing host to the G7 as its current president, the nation is deeply conflicted. On the one hand it presides over a network of tax-friendly overseas territories like the BVI, Cayman Islands and Bermuda.  But at the same time, Britain has had to show robust tax leadership to prevent tax avoidance as current president of the G7. 

https://theconversation.com/g7-deal-uk-is-badly-conflicted-between-offshore-tax-havens-and-bidens-global-tax-drive-162190 

BREXIT FUELLING RISE IN INTEREST IN JERSEY FROM THE SUPER-RICH

On 6 June, the Jersey Evening Post reported that Brexit and the pandemic are fuelling a surge in interest from multi-millionaires in moving to the Island – with Jersey this year set to record one of its highest numbers of new ‘high-value’ residents.

https://jerseyeveningpost.com/news/2021/06/06/brexit-fuelling-rise-in-interest-in-jersey-from-the-super-rich/

 

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FATF: CONSOLIDATED AML/CFT ASSESSMENT RATINGS

On 4 June, FATF issued an updated consolidated schedule of countries’ AML/CFT ratings to date, following the publication of follow-up reports on Bhutan and Pakistan.

https://www.fatf-gafi.org/media/fatf/documents/4th-Round-Ratings.pdf

 

 

 

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CHINA’S FOREIGN TECHNOLOGY WISH LIST

In May, the Center for Security and Emerging Technology in the US published this report examining which types of technologies the Chinese government is most focused on acquiring, and from where.  This information is said to have been gleaned from reports submitted by “science and technology diplomats” stationed in PRC embassies and consulates across 52 countries.  These coordinate with overseas scientists, professional associations, diaspora guilds, and elements of the United Front Work Department in the countries where they are stationed, to identify opportunities where Chinese companies can grow relationships and invest.  Nearly half of all technology projects referred the diplomats originated in Russia, the US, UK, and Japan.  Prior to its closure in July 2020, the consulate in Houston, Texas, referred the most projects of any Chinese diplomatic post in the world.  However, fewer than 12% of projects in the dataset used originated in the US, but NATO members and US- designated Major Non-NATO Allies hosted more than 70% of the projects targeted by Chinese diplomatic personnel from 2015 to 2020.

https://cset.georgetown.edu/wp-content/uploads/CSET-Chinas-Foreign-Technology-Wish-List.pdf

 

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ASSESSORS HAND MALTA ANOTHER TO-DO LIST TO FIGHT FINANCIAL CRIME

On 6 June, the Times of Malta reported that the country was handed a new, hefty to-do list by international assessors from FATF.  Assessors from the FATF, who were in Malta in May, have written to the Finance Ministry with a number of reforms and improvements that the country still needs to enact in the fight against financial crime.  FATF is said to have referred to low seizures of criminal assets, lax rules on lawyers providing fiduciary services, and the “low quality” of STR by banks and other entities. The heads of 2 Maltese regulators told the Times of Malta that the list of reforms sent by the FATF in recent weeks is lengthy and Malta would need at least a year to adequately address them.  The decision over whether Malta will be grey-listed will be taken during a FATF plenary session later this month – there has never been an EU Member State on the grey list before and being placed on it could seriously impact Malta’s ability to do business as well as its attractiveness to foreign investors.

https://timesofmalta.com/articles/view/assessors-hand-malta-another-to-do-list-to-fight-financial-crime.877142

 

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PROJECT DIVERT: FIREARMS THEFT IN THE EU

On 26 May, the Flemish Peace Institute published a report on the Project which focuses on 3 specific diversion methods; theft, fraud and non-regularisation.  Available online is the Part devoted to theft.  The Project is a research project, funded by the EU Internal Security Fund — Police, which focuses on the diversion of live-firing firearms from the legal domain into the illicit sphere within the EU.  It argues that theft is an important diversion method in the EU and statistical evidence shows that large quantities of firearms are diverted through theft each year.  The analysis suggests annually between 20,000 to 25,000 firearms are registered as stolen in the EU and says one can expect a rather high number of stolen firearms which are either not noticed or not declared to the authorities.  The analysis further demonstrates significant national differences exist in the number of registered stolen firearms.  These differences tend to reflect differences in the level of legal firearms holdings, but also other contextual factors such as the dynamics of illicit gun markets seem to play a role. In addition, the number of firearms thefts seems to be decreasing in most Member States.  Private individuals are most often targeted in the EU.  Perhaps surprisingly, the report says that in most Member States stolen firearms are not the primary types of firearms possessed in the criminal underworld.

https://vlaamsvredesinstituut.eu/wp-content/uploads/2021/05/20210526-DIVERT2-FirearmsTheft.pdf

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US SUPREME COURT SIGNIFICANTLY LIMITS THE SCOPE OF THE COMPUTER FRAUD AND ABUSE ACT

On 4 June, an article from DLA Piper reported on the outcome of a recent Supreme Court case involving a police officer in Georgia who was authorised to access material on the computer system, but raised questions as to the illegality of the extent and use made of the information.  It was held that that a person does not “exceed authorized access” to a “protected computer” under the Act when using information obtained from accessing that computer for an unauthorised purpose.  The Act creates criminal and civil liability for any person who “intentionally accesses a computer without authorization or exceeds authorised access, and thereby obtains” virtually any type of information stored on any computer connected to the Internet.  The article warns that the decision will largely gut the Act as a tool for addressing insider data theft.  It says that the implications of the decision are “staggering” and outlines some immediate steps for organisations to consider in light of the ruling.

https://www.dlapiper.com/en/us/insights/publications/2021/06/supreme-court-significantly-limits-the-scope-of-the-computer-fraud-and-abuse-act/

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