OTHER THINGS YOU MAY HAVE MISSED – JULY 7

Panama Covid-19 update – there are to be added restrictions in a number of districts, extended curfew and all-day lockdown on Sundays for one or two. Meanwhile, vaccinations continue, with over 21,000 in the last 24 hours.

Meanwhile, today saw 1,222 new cases reported and 8 new fatalities (making the total to date 1 short of 6,600). There are 13,540 active cases, including 114 in ICU and 610 in other wards (both the latter figures showing falls).

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

7 JULY 2021

US: TSA PROGRAMME WILL FACILITATE COMPLIANCE WITH NEW CARGO SCREENING REQUIREMENTS

On 7 July, an article from Cozen O’Connor is concerned with the Transportation Security Administration (TSA) introducing the new secured packing facility (SPF) programme.  Those registered under the SPF programme are required to implement a “system of government-approved security controls sufficient to prevent the introduction of concealed explosives into the air cargo supply chain”.  Cargo aircraft operators would be permitted to accept cargo from SPF without conducting additional screening, providing significant supply chain benefits in the form of reduced delays and costs.  SPF is one of the measures required as a consequence of the change from 30 June whereby the International Civil Aviation Organization (ICAO) requires that all ICAO member states to apply the same security screening measures to cargo travelling on passenger as on all-cargo aircraft. 

https://www.lexology.com/commentary/aviation/bcba8ecc-00a4-4eb0-af7b-190b4672c9ed

CAYMAN ISLANDS UPDATE ON ECONOMIC SUBSTANCE AND AEOI

On 5 July, a briefing from Walkers provides a round-up of recent updates to the economic substance and AEOI regimes arising from economic substance regulations published by the Cayman Islands Government, updated economic substance guidance issued by the Cayman Islands Tax Information Authority and a bulletin published by the Department for International Tax Cooperation. 

https://s3.amazonaws.com/documents.lexology.com/3fa23a67-d703-450e-983c-a52e15255052.pdf?AWSAccessKeyId=AKIAVYILUYJ754JTDY6T&Expires=1625658263&Signature=GB9vte61pbUusrPOHb%2BTghd3%2BKM%3D

GUIDE TO CORPORATE SELF-REPORTING IN THE UK

On 1 July, a briefing from Brodies LLP contrasts the self-reporting initiative operating in Scotland with the deferred prosecution agreement regime operating in the rest of the UK.  It takes the form of a set of FAQ.

https://brodies.com/insights/corporate-crime-and-investigations/guide-to-corporate-self-reporting-in-the-uk/

LIMITATION PERIODS: WHAT A DIFFERENCE A DAY MAKES UNDER ENGLISH LAW

On 2 July, an article from Brodies LLP explains that under English law, a potential Claimant has a set period of time to commence a claim, after which it will be time barred and the Claimant will be unable to bring the claim (this is known as the limitation period).  It is possible for the limitation period to be extended (by way of a “standstill” agreement between the parties), but the general position is that a claim cannot be brought after the expiration of 6 years from the date on which the cause of action accrued (in respect of claims brought under tort or contracts).  A recent Supreme Court case was concerned with the question of limitation periods, which are strictly interpreted by the courts.  It is made clear that while it may be possible to agree with the Defendant the date from which the parties will treat the limitation period has having commenced, including extending the limitation period, it is not guaranteed that a prospective defendant would agree to this.

https://brodies.com/insights/litigation/limitation-periods-what-a-difference-a-day-makes/

HOW GERMAN SUPPLY CHAIN LAW WILL AFFECT ECUADORIAN BANANA PRODUCERS

On 7 July, Fresh Plaza reported that the new law brings developments in human rights, commercial and contractual relations, and seeks to ensure proper compliance with human rights in the supply chain of products traded in Germany.  German retailers may introduce new clauses in contracts, new certifications or control measures.  It is said that it will also be necessary to examine whether possible cost increases are distributed and shared among all actors in the chain.

https://www.freshplaza.com/article/9337179/how-german-supply-chain-law-will-affect-ecuadorian-banana-producers/

SECRET FARMHOUSES AND TALCUM POWDER: THIS IS HOW DEALERS ARE SMUGGLING HEROIN INTO INDIA

On 7 July, a report from Vice said that heroin is the most trafficked substance in India, and is also the most commonly used opioid.  Heroin is usually smuggled into India from Afghanistan or Africa through sea routes in Mumbai and Gujarat, or across borders in Rajasthan and Punjab.

https://www.vice.com/en/article/bvzy3z/heroin-drug-smuggling-india-busts-pakistan-afghanistan-golden-triangle

UPDATED CENTRAL BANK OF IRELAND AML/CFT GUIDELINES FOR 2021

On 6 July, an article from Grant Thornton said that in June the Central Bank of Ireland (‘CBI’) issued an updated revision of their guidelines on AML/CFT for the financial sector. The revised guidelines take into account the recently enacted 5th EU Money Laundering Directive, the CBI’s regulatory expectations as set out in previous AML/CFT bulletins as well as the updated European Banking Authority AML/CFT Risk Factor guidelines which were issued in Q1 2021. Some of the key changes which have come out of the revised guidelines are explained in the article.

https://www.grantthornton.ie/insights/factsheets/aml-bulletin–updated-central-bank-of-ireland-amlcft-guidelines-for-2021

AUSTRALIA: LOAN FRAUD IS GREATEST AML/CTF RISK TO NON-BANKS

On 7 July, The Adviser reported that loan application and identity fraud are the main threats to non-banks, the government agency AUSTRAC has concluded, noting the sector’s reliance on third-party players.  The conclusion is made in a new report which assesses the non-bank lending and financing sector’s risk.

https://www.theadviser.com.au/breaking-news/41760-loan-fraud-is-greatest-aml-ctf-risk-to-non-banks-austrac

NICARAGUA OPPOSITION ARRESTS CLIMB TO 26

On 7 July, EurActiv reported that Nicaragua has arrested a sixth presidential contender and 4 other opposition figures, bringing to 26 the number of people rounded up by long-term leader Daniel Ortega’s forces ahead of November elections.

https://www.euractiv.com/section/global-europe/news/nicaragua-opposition-arrests-climb-to-26/

EU DELETES STATE CONTRACTING WATER AND SEWAGE PROJECTS COMPANY FROM IRAQ SANCTIONS LISTS

An EU Regulation has finally removed the STATE CONTRACTING WATER AND SEWAGE PROJECTS COMPANY from the EU sanctions lists.

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv%3AOJ.L_.2021.239.01.0022.01.ENG&toc=OJ%3AL%3A2021%3A239%3ATOC

€14.2 MILLION SEIZED FROM CROSS-BORDER VAT FRAUDSTERS IN HUNGARY

A news release from Europol on 7 July advised that the Hungarian National Tax and Customs Administration (NTCA), supported by Europol, had dismantled an organised crime group involved in cross-border VAT MTIC (missing trader intra-community) fraud and carousel fraud.

https://www.europol.europa.eu/newsroom/news/€142-million-seized-cross-border-vat-fraudsters-in-hungary

MODERN SLAVERY TRAINING: UK RESOURCE PAGE

On 7 July, the Home Office published updated information on training and awareness-raising resources available to public sector organisations to help their staff understand modern slavery and learn to spot the signs.

https://www.gov.uk/government/publications/modern-slavery-training-resource-page/modern-slavery-training-resource-page

UK: ROYAL COMMISSION ON CRIMINAL JUSTICE GOING AHEAD

On 7 July, the Law Society Gazette reported that the UK Government has confirmed that it still intends to hold the Royal Commission announced in the Queen’s Speech of December 2019 to review and improve efficiency in the criminal justice system.  The commission may not report until 2023.

https://www.lawgazette.co.uk/news/royal-commission-on-criminal-justice-going-ahead-says-moj/5109111.article

MAKING THE UK ECONOMIC CRIME PLAN MATTER IN THE REAL WORLD

On 7 July, an article from RUSI says that, despite welcome steps forward in policy implementation, progress on the operational aspects of the UK’s flagship Economic Crime Plan is lagging.  In 2019, the UK government launched its first ever Economic Crime Plan, covering the 2019–2022 period.  It says that,2 years into the 3-year plan, and with the government itself having issued its progress report, it is perhaps a good time to reflect on whether the high-minded promises of 2019 are having real-world impact in 2021.

https://rusi.org/explore-our-research/publications/commentary/deeds-not-words-making-economic-crime-plan-matter-real-world

WORLD DRUG REPORT 2021

On 24 June, the UN Office on Drugs and Crime which provides an in-depth analysis of the global drug markets and paints a comprehensive picture of the measurable effects and potential impact of the COVID-19 crisis on the world drug problem.  It says that around 275 million people used drugs worldwide in the last year, while over 36 million people suffered from drug use disorders. 

https://www.unodc.org/unodc/press/releases/2021/June/unodc-world-drug-report-2021_-pandemic-effects-ramp-up-drug-risks–as-youth-underestimate-cannabis-dangers.html

CPS SIGNALS TOUGHER APPROACH TO UK REGULATED SECTOR ENFORCEMENT

On 6 July, an article from Out-Law says that revised guidance from the Crown Prosecution Service suggest that it has toughened its stance against regulated firms in England and Wales that fail to disclose suspicions of money laundering.  A change of stance follows on from the announcement of the first criminal investigation for breach of the Money Laundering Regulations 2007 in March 2021.

https://www.pinsentmasons.com/out-law/analysis/cps-signals-tougher-approach-uk-regulated-sector-enforcement

https://www.cps.gov.uk/legal-guidance/money-laundering-offences

FINANCIAL FIRMS: REVISE WHISTLEBLOWING POLICIES FOR ‘NEW WORLD’ OF WORK

On 7 July, an article from Out-Law says that, with 5 months to go before new whistleblowing laws come into force across the EU, UK and European financial services employers should review their policies to ensure that they reflect new ways of working and international best practice.  The EU Directive which must be transposed by Member States by 17 December (with some exceptions). However, UK-headquartered multinational firms will either have to reflect the changes in their global whistleblowing policy, or choose to adopt a jurisdiction-by-jurisdiction approach, particularly if some EU countries go further than required by the Directive.

https://www.pinsentmasons.com/out-law/analysis/financial-firms-whistleblowing-new-world-work

10 WAYS TO GET A DEFERRED PROSECUTION AGREEMENT (DPA)

On 7 July, an article from Eversheds Sutherland says that of the 10 DPA which have to-date been successfully agreed and approved by the Court, 7 relate to bribery (the others being used to resolve charges of fraud and false accounting).  DPA have therefore become a part of the UK’s bribery enforcement toolkit, and a key means for UK prosecutors to resolve corporate breaches of the UKBA.  However, it is said that formal guidance on how companies can secure a DPA has been relatively limited.  It is said that companies wanting to secure a DPA are best advised to look closely at the documents published in relation to the other concluded DPA, as well as the extensive legal commentary which is in the public domain, and apply this to their own facts and circumstances.  The article argues that one keyword has emerged from the available case law to date: “cooperation”.  The article goes on to list the 10 suggestions.

https://www.eversheds-sutherland.com/global/en/what/articles/index.page?ArticleID=en/Fraud_and_financial_crime/10_ways_to_get_a_Deferred_Prosecution_Agreement

THE IMPACT OF ORGANISED CRIME ON THE EU’S FINANCIAL INTERESTS

A briefing paper from the EU Parliament Research Service on 7 July says that the available evidence suggests that the scale of fraud against the EU finances is vast.  On the revenue side in particular, estimates from the Commission suggest that the VAT gap amounted to €150 billion in 2016, €50 billion of which were defrauded by criminal groups.  Other estimates indicate potentially higher levels of fraud.  It says that research has found that there are shortcomings in measures to combat fraud at both the EU and Member State levels.  It also says that research suggests that more needs to be done by national authorities to increase the confiscation rate of funds associated with fraud with more emphasis on preventative measures to deter organised crime from defrauding the EU’s finances in the first place.

http://www.europarl.europa.eu/RegData/etudes/ATAG/2021/696058/IPOL_ATA(2021)696058_EN.pdf

https://www.compoundchem.com/2021/07/06/covid-transmission/

DEMOCRATIC REPUBLIC OF CONGO LIFTS FORMER PRIME MINISTER’S IMMUNITY OVER CORRUPTION ALLEGATIONS

On 6 July, VON reported that the DRC former Prime Minister Matata Ponyo Mapon has seen his parliamentary immunity lifted, as the Senate leadership announced it had authorised a criminal investigation into allegations that he misappropriated $140 million.

https://von.gov.ng/2021/07/06/congo-lifts-former-prime-ministers-immunity-over-corruption-allegations/

UK: SRA FINES FRESH BATCH OF LAW FIRMS FOR BREACHING AML RULES

On 7 July, the Law Society Gazette reported that a fresh batch of fines has been issued by the Solicitors Regulation Authority to firms failing to meet AML requirements, with 7 practices fined.

https://www.lawgazette.co.uk/news/sra-fines-fresh-batch-of-firms-for-breaching-aml-rules/5109108.article

FINANCIAL CRIME – THE FINE LINE BETWEEN HELPING AND ENABLING

On 28 June, an article from Ince says that the Panama Papers, Paradise Papers and FinCEN Files are document leaks that exposed the vast network of industrial-scale potential financial crime around the world.  It says that the Paradise Papers also threw light on the legal firms, financial institutions and accountants working with clients to reduce their tax burden; obscure their ownership of assets like companies and real estate; and set up offshore trusts that in some cases held billions of dollars.  There are many ways in which the professional enabler can hold the key to creating the complex structures and processes that can provide the necessary anonymity to facilitate financial crime, and that ‘professional enablers’ and can pose a very significant threat to the financial system.

https://www.incegd.com/en/news-insights/financial-crime-fine-line-between-helping-and-enabling

CRIMINALS OR VIGILANTES? – THE KULUNA GANGS OF THE DEMOCRATIC REPUBLIC OF CONGO

On 17 June, a Paper from the Global Initiative Against transnational Organised Crime says that the current rise in insecurity in Kinshasa, the capital of DRC, is often attributed to urban youth gangs – the Kulunas.  Embedded in Kinshasa’s neighbourhood life and partnered with local political parties and law enforcement agencies, these gangs threaten urban security in the city.  The paper examines the rise of the Kulunas from a historical and sociological perspective, and analyses the state’s security responses to address it.

https://globalinitiative.net/wp-content/uploads/2021/06/Criminals-or-vigilantes-The-Kuluna-gangs-of-the-Democratic-Republic-of-Congo-GITOC.pdf

ILLEGAL FISHING IN SOMALIA AND THE CAPTURE OF STATE INSTITUTIONS

On 2 July, a Paper from the Global Initiative Against Transnational Organised Crime says that the waters off Somalia are some of the richest fishing grounds in the world and are still largely untapped.  It says that since the decline in attacks by Somali pirates since 2012, foreign fishing fleets have gradually returned to Somali waters. However, many of these vessels, particularly those originating in Iran, Yemen and SE Asia, routinely engage in IUU (illegal, unreported and unregulated) fishing practices.  It says that state institutions are extremely weak and corruption is widespread.  Fishing licences and other permissions issued by one local Somali authority are often not recognized by another.  The paper presents 3 case studies of IUU fishing practices in Somalia, each illustrating a different facet of corruption within Somali state institutions.

https://globalinitiative.net/wp-content/uploads/2021/07/GITOC-ESAObs-Fishy-Business-Illegal-fishing-in-Somalia-and-the-capture-of-state-institutions.pdf 

PODCAST: “WILFUL BLINDNESS: HOW A NETWORK OF NARCOS, TYCOONS, AND CCP AGENTS INFILTRATED THE WEST”

In the latest TRACE podcast, investigative reporter Sam Cooper describes the waves of drugs and laundered money from China crashing on Canada’s shores.

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

CFIUS HEIGHTENS SCRUTINY OF NON-NOTIFIED TRANSACTIONS

On 7 July, Torres Law published an article saying that, for many years, the Committee on Foreign Investment in the United States (CFIUS) has had the authority to review non-notified transactions – deals which have not been submitted to CFIUS for review and approval – but until recently, resources for such efforts were limited.  That changed in 2018, when the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) significantly bolstered resources for CFIUS oversight and enforcement activities.  It explains what non-notified and non-declared transactions are and CFIUS can determine that a non-notified transaction may be subject to its jurisdiction.  It then outlines the CFIUS process for reviewing non-notified/non-declared transactions, and considers recent CFIUS scrutiny of non-notified transactions.  It considers key takeaways about the heightened review of non-notified/non-declared transactions. 

https://www.torrestradelaw.com/posts/CFIUS-Heightens-Scrutiny-of-Non-045%3BNotified-Transactions/242

EU UKRAINE SANCTIONS ANNULLED – BUT 2 DESIGNATIONS REMAIN IN FORCE

On 7 July, the EU Sanctions blog reported that the EU General Court has annulled the 2020 designations of Sergej Arbuzov, the former Prime Minister of Ukraine, Viktor Pshonka, former Prosecutor General, and his son Artem Pshonka.  However, Viktor Pshonka and Artem Pshonka remain subject to EU sanctions as they were re-listed on 5 March. 

https://www.europeansanctions.com/2021/07/2020-listings-of-3-ukrainian-former-officials-annulled/

BENFICA FOOTBALL CLUB PRESIDENT DETAINED IN TAX FRAUD PROBE

On 7 July, Yahoo Sport reported that Portugal’s biggest football club Benfica has said that their president Luis Filipe Vieira was detained as part of an investigation into alleged tax fraud and money laundering.  The prosecutors’ office alleged that offences including fraud, money laundering and forgery had been committed since 2014.  RTP and other local media said Vieira’s business partner Jose Antonio dos Santos was also detained. Antonio dos Santos is the largest individual shareholder of Benfica SAD.  It is said the investigation was related to loans granted by Portuguese lender Novo Banco to Vieira’s business group as well as to the sale of shares in Benfica SAD.

https://uk.sports.yahoo.com/news/soccer-benfica-club-president-detained-173454834.html

FCA FORCED TO APOLOGISE TO SCOTTISH BOAT INSURER WHO THEY HAD ACCUSED OF FRAUD

On 7 July. The Daily Mail reported that Stuart Forsyth, who ran a boat insurance company, was accused by the FCA of funnelling around £200,000 of his salary to his wife to cut his tax bill.  The FCA and the Bank of England’s Prudential Regulation Authority fined him £154,498, and banned him from working in the regulated sector.  But they have now had to apologise after a judgement from the Upper Tribunal found the accusations ‘wholly unsubstantiated’.

https://www.thisismoney.co.uk/money/news/article-9766217/FCA-apologises-Scottish-boat-insurer-Stuart-Forsyth-tax-row.html

INDIA: POLICE BUST CALL CENTRES DUPING US CITIZENS

In its 8 July edition, the Hindustan Times reported that 95 people, including 19 women, were arrested for allegedly running 2 fraud call centres in Delhi from where they contacted the US citizens impersonating as officials of the country’s social security administration and duped them of their money by threatening to revoke their social security number (SSN).  The alleged suspects were using illegal techniques, VOIP calling, bypassing the legal international long distance (ILD) gateways for cheating the US citizens. A total of 82 computers, 5 laptops, 84 mobile phones and 48 identity cards were also seized.

https://www.hindustantimes.com/cities/delhi-news/police-bust-call-centres-duping-us-citizens-arrest-95-detain-2-101625693278311.html

“GREENWASHING” AND ITS POTENTIAL THREATS

On 7 July, a release on Mondo Visione consisted of the text of an article by a Commissioner of ASIC in Australia says that, in its recent consumer research report, the Responsible Investment Association Australasia (RIAA) revealed that 86% of Australians expect their superannuation or other investments to be invested responsibly and ethically. It is said that the Australian Securities and Investments Commission (ASIC) is currently conducting a review to establish whether the practices of funds that offer these products align with their promotion of these products; in other words, whether the financial product or investment strategy is as “green” or ESG-focused as claimed.  The potential for funds to overrepresent the extent to which their practices are environmentally friendly, sustainable or ethical is referred to in the market as “greenwashing”.

https://mondovisione.com/media-and-resources/news/what-is-greenwashing-and-what-are-its-potential-threats-by-commissioner-cathi/

ASSESSING THE THREAT OF WEAPONISED CORRUPTION

On 7 July, an article on Lawfare says that to utilise its new anti-corruption strategy, the Biden Administration will be required to assess the nature and size of the threat of weaponised corruption.  This exercise will require new definitions, diagnostics and data: what precisely is weaponised corruption, as distinct from other forms of corruption?  What are the strategic purposes and sources of the threat?  How does weaponisation work tactically?  How much and what type of damage is being caused to US security interests?  The threat is new to national experts trained to analyse more traditional challenges, such as China’s military posture in the South China Sea or Russia’s violations of nuclear arms control treaties.  It says that the term “weaponisation” implies that corruption is being used purposefully as a tool of statecraft to interfere with, co-opt, weaken, and destabilise democratic institutions and processes.  The post uses Russia as a example for closer examination, and saying that it has a range of corruption techniques perfected at home that it can use to seek specific policy outcomes and the destabilisation of democracies in other nations.

https://www.lawfareblog.com/assessing-threat-weaponized-corruption

Any modest contributions for my time and ongoing expenses are welcomed!  I have a page where you can do so, and 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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