Panama Covid-19 update – the cumulative death toll edged over 6,600 today, with 3 new fatalities taking the total to 6,604. New cases continue in high numbers, with another 1,240 reported today. However, numbers in ICU rose by only 1 to 115, with fewer people in other wards (594, down 14) and hospital hotel rooms (324, down 23) – with there being 13,600 active cases in all (an increase of 60 over yesterday).
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8 JULY 2021
US LAB OWNER CHARGED IN HEALTH FRAUD SCHEME
On 7 July, AP reported that Fadel Alshalabi, 53, a Tennessee health lab owner, has been charged with orchestrating a fake Medicare billing scheme. A statement said he is the owner and CEO of Crestar Labs, which billed Medicare about $86 million for genetic testing from 2017 to 2021 and was paid nearly $14 million for those claims.
POLICE IN HONG KONG AND MACAU BREAK UP ROMANCE SCAM SYNDICATE
On 7 July, KYC 360 reported that the syndicate suspected of swindling 17 women out of HK$21.5 million. Police said the fraudsters looked for targets online and, after developing close romantic relationships with them, requested they make money transfers under various pretexts.
PODCAST: IMPACT OF CRYPTOCURRENCIES ON INTERNATIONAL TRADE
On 5 July, a podcast from the International Chamber of Commerce features guest speaker Henri Arslanian, Crypto Leader and Partner at PwC, who answers some critical questions around cryptocurrencies. Can cryptocurrencies ever become ‘the currency of choice’ for international trade? Will China’s recent ban on cryptocurrency transactions by financial institutions and payment companies have an impact on international trade? What should people involved in international trade look out for in today’s ever-evolving global market?
HMRC-BRANDED PHISHING SCAMS EXPERIENCE 87% RISE IN 12 MONTHS
On 5 July, Security Matters reported that reports of HMRC-branded phishing scams have jumped from 572,029 to 1,069,522 in the last year, representing a surge of 87%.Datashows that reports of suspected SMS scams shot up by 52% on last year, rising from 67,497 to 102,562 attacks. Further, email scams exploded, rising from 301,170 to 630,193, while reports of phone call scams increased by 66% from 203,362 to 336,767. Of the scams listed, the majority were tax rebate or refund scams which rose by 90% from 363,118 to 690,522. In addition, voice scam attacks escalated by 66%, jumping from 203,362 to 336,767.
TANZANIA RESUMES TALKS FOR $10 BILLION CHINA-BACKED PORT
On 7 July, Dryad Global reported that the Tanzanian President has said her government has resumed talks on a planned $10 billion port project backed by China, which was suspended by her predecessor in a disagreement over terms. China Merchants Holdings International, China’s largest port operator, broke ground for the port and special economic zone in October 2015; 75 km (47 miles) north of Dar es Salaam.
9 JAILED IN FIRST TOGO PIRATE TRIAL
On 7 July, Dryad Global reported that 9 pirates who attempted to hijack a ship in Togolese waters in May 2019 have been sentenced to prison terms ranging from 12 to 20 years. A total of 10 pirates, including 7 Nigerians, 2 Togolese and a Ghanaian, went on trial for “maritime piracy, wilful violence and groups of criminals”.
FISHERMEN FIGHT OFF PIRATE ATTACKS IN ECUADOR
On 7 July, Dryad Global reported that fishermen in Ecuador have taken matters into their own hands to combat pirate attacks that have long plagued the nation’s coastal provinces. It is said that authorities have promised to step up maritime controls and asked fishermen to report attacks to the Attorney General’s Office. Groups of heavily armed pirates working along Ecuador’s western coast have targeted small fishing vessels for years to steal their motors.
US: LASER EXPERT CHARGED WITH ECONOMIC ESPIONAGE, THEFT OF TRADE SECRETS, AND UNLAWFUL EXPORTS
The Genesee Sun reported that a New York man, Ji Wang, 59, was arraigned after a federal grand jury in Rochester returned an indictment charging him with economic espionage, theft of trade secrets and violating the International Emergency Economic Powers Act (IEEPA). He had worked on a fibre laser research and development project initiated by the Defense Advanced Research Projects Agency (DARPA).
ARGENTINA SEEKS SANCTIONS AGAINST OIL COMPANIES DRILLING NEAR DISPUTED FALKLAND ISLANDS
On 7 July, the Rio Times reported that the Argentine government has begun a process of sanctioning many foreign companies accusing them of illegally drilling oil in conflicted areas near the UK-controlled Falkland Islands. It named UK-based Chrysaor Holdings, Harbor Energy, and Israeli company Navitas Petroleum, with another 8 companies said to be at risk.
CHINA SEIZES 2 TONNES OF SMUGGLED PANGOLIN SCALES FROM VIETNAM
On 8 July, VN Express reported that Customs agents in south-west China have seized 2.2 tonnes of pangolin scales and busted an endangered wildlife smuggling gang. The scales had been smuggled across the border from Vietnam.
IS NEPAL BECOMING A HAVEN FOR CHINESE CRIMINALS?
On 8 July, Khabarhub claimed that Chinese nationals are involved in wildlife smuggling, hacking, and operating mini-casinos in Nepal. According to the police headquarters, more than 100 Chinese nationals have been arrested in the past 5 years in connection with various illegal activities in Nepal. In December, police raided various places in Kathmandu and arrested as many as 122 Chinese nationals who were residing illegally in Kathmandu and were involved in financial crimes.
A YEAR ON FROM WIRECARD COLLAPSE, GERMANY STILL LOSING THE FIGHT
On 7 July, Fortune reported that a new anti-corruption report blasts the country’s feeble political will to combat money laundering as “not even remotely sufficient”. The report, issued by advocacy group Transparency International, comes roughly a year after the implosion of German fintech darling Wirecard, Corporate Gemany’s biggest accounting scandal in years, and as many fraud investigators warn of the rise of cryptocurrency scams. The report warns of massive gaps in the country’s oversight of individuals and companies.
THE PARLIAMENT OF THE ECONOMIC COMMUNITY OF WEST AFRICAN STATES (ECOWAS PARLIAMENT) HAS EXPRESSED CONCERNS OVER THE USE OF CRYPTOCURRENCIES
On 8 July, the Leadership website in Nigeria reported that it was the focus of the meeting of the Joint Committees of the ECOWAS Parliament.
AUSTRALIA: LOAN FRAUD IS GREATEST AML/CFT RISK TO NON-BANKS
On 7 July, The Adviser in Australia reported that, according to AUSTRAC, loan application and identity fraud are the main threats to non-banks, AUSTRAC noting the sector’s reliance on third-party players. It is said that the conclusion is made in a new report which assesses the non-bank lending and financing sector’s risk of money laundering and terrorism financing.
JAPAN IDENTIFIES NORTH KOREA AS MAJOR CYBER THREAT IN NATIONAL SECURITY DOCUMENT
On 8 June, NK News reported that a new report singles out DPRK along with China and Russia, and outlines plan for greater cyber defences. A key Japanese government cybersecurity organisation has identified North Korea as one of the primary actors posing cybersecurity threats to the country.
UK: CONSULTATION OF REFORM OF OFFICIAL SECRETS ACTS AND CREATION OF A FOREIGN INFLUENCE REGISTRATION SCHEME
On 8 July, the Home Office launched a consultation which sets out the government’s proposals and seeks input to inform the final policy and legislative proposals. Proposals include creation of a (CFIUS-like) Foreign Influence Registration Scheme – described as an important new tool to help combat espionage, interference, and to protect research in sensitive subject areas, as well as to provide a greater awareness of foreign influence currently being exerted in the UK. The consultation also considers whether there is the case for new tools and powers to criminalise other harmful activity conducted by, and on behalf of states.
UK FACING ‘TSUNAMI’ OF FRAUD, EXPERTS WARN MPs IN PLEA FOR SWIFT ACTION
On 8 July, the Evening Standard reported that the UK is facing a worse threat from fraud than during the 2008 financial crisis and the Government’s efforts to fight it are falling far short, a Parliamentary Committee has been told. The Chair of the Fraud Advisory Panel told the Committee that there is a “major tsunami” of fraud coming, and the UK has created a “haven for fraudsters”.
UK: VARIATION OR REVOCATION OF A SANCTIONS DESIGNATION OR REVIEW OF A UN LISTING
On 8 July, the Foreign Commonwealth and Development Office published 2 news releases. One had linked a form is for designated persons, UN-listed persons, or persons acting on their behalf, to request a review of their designation or UN listing. The other contained guidance on how to request a variation or revocation if you have been designated under the Sanctions Act or named on a UN list.
AUSTRIA’S EX-VICE CHANCELLOR ON TRIAL FOR CORRUPTION
On 8 July, OCCRP reported that Heinz-Christian Strache, Austria’s former Vice-Chancellor, and leader of the far-right Freedom Party (FPÖ) is on trial in Vienna for helping change a law in order to accommodate the owner of a private hospital in exchange for a donation to his party and a weekend on the hospital owner’s yacht.
COVID-19 AND CRIME: THE IMPACT OF THE PANDEMIC ON HUMAN TRAFFICKING
On 8 July, the UN Office on Drugs and Crime released a study which illustrates the devastating impact of COVID-19 on victims and survivors of human trafficking and highlights the increased targeting and exploitation of children. It assesses how frontline organisations responded to the challenges posed by the pandemic and continued to deliver essential services despite restrictions.
MALAYSIA: CUSTOMS SEIZE 40 MILLION ILLEGAL CIGARETTES
On 8 July, The Star reported that 4 containers containing over 40 million sticks of contraband cigarettes have been seized by the Customs Department. The import manifest for the containers were declared as telekung (head scarves) and used pallets.
A BRIEF HISTORY OF ‘RACHADINHA’ – THE CORRUPTION SCHEME HAUNTING BRAZIL’S BOLSONARO
On 7 July, Insight Crime published this article about an extortion scheme where political staffers had to give up part of their salaries in order to keep their jobs, a practice known as “rachadinha“.
TRACING GOLD FROM THE PERUVIAN AMAZON TO DOWNSTREAM BUYERS
A post from C4ADS says that the organisation has analysed the business activities of 3 gold trading companies active in Madre de Dios, a Peruvian region where unregulated gold mining has caused severe environmental damage, to better understand how high-risk gold from the region enters global markets and reaches end-users. Nearly all of the gold exported by these companies since 2017 has been shipped to India and the UAE, where most of it appears to be refined and traded as bullion or jewellery. It says that the findings suggest that downstream companies must look beyond their immediate suppliers to gauge the full impact of their sourcing practices.
TURKMENISTAN: ‘RAMPANT’ CORRUPTION DRIVES COUPLES TO ILLEGAL ADOPTIONS
On 7 July, Rferl reported that some maternity wards in Turkmenistan secretly offer abandoned babies for illegal adoption to prospective parents willing to pay a bribe to skip the normal bureaucracy and long wait that goes with the process. The illegal deal often involves employees from registry offices who provide the new parents with false birth certificates that show them as the biological parents.
IRISH REVENUE SEIZE 12.5 TONNES OF TOBACCO AT DUBLIN PORT
A news release from the Revenue Commissioners on 7 July advised that, as a result of routine profiling and with the assistance of Revenue’s mobile X-ray scanner and detector dog Waffle, Revenue officers seized over 12.5 tonnes of ‘roll your own’ tobacco at Dublin Port. It originated in Bulgaria and had an estimated retail value of over €7.7 million.
LONDON SOLICITOR JAILED FOR £380,000 STAMP DUTY FRAUD
On 7 July, My News Desk reported that the former owner of a West London law firm has been jailed for more than 3 years. Manpreet Singh (formerly Munpreet Singh Virdee) was the owner and director of Reemans Solicitors Ltd. An investigation revealed the 50-year-old repeatedly falsified documents and submitted incorrect information to HMRC to reduce the amount of stamp duty due. He charged his clients the full correct amount and pocketed the difference.
FRAUD SCHEME OF AT LEAST €120 MILLION IN ITALY HALTED
On 7 July, a news release from Eurojust advised that Eurojust has supported the Italian authorities in bringing to a halt a long-running fraud scheme based on a series of fake websites and shell companies to evade tax authorities for an estimated €120 million and cheat thousands of customers.
LOS ANGELES POLICE MAKE RECORD BLACK MARKET CANNABIS BUST
On 7 July, ABC News reported that Los Angeles police have made the largest illegal marijuana seizure in the county’s history, netting 373,000 plants that would ultimately have been worth about $1.2 billion on the street. However, it is said that the record bust eradicated only a fraction of the illicit “grows” in the Southern California high desert.
KOREAN INVESTIGATION FINDS $1.48 BILLION IN ILLEGAL OVERSEAS CRYPTO TRANSACTIONS
On 8 July, Investing.com reported that an interagency investigation into suspected crypto fraud and money laundering in South Korea has led to the discovery of about $1.48 billion in illegal overseas cryptocurrency transactions; and 33 people have been implicated by the Seoul Central Customs for contravening the country’s ban on overseas crypto trading.
OUTCOME OF CFATF VIRTUAL PLENARY & WORKING GROUPS MEETING
On 7 July, the FATF-style regional body for the Caribbean has published information on the outcome of the May Plenary and working groups meetings held 12-27 May. Procedural changes for mutual evaluations were adopted, and the Trinidad and Tobago 4thRounf Enhanced Follow-up Report was considered.
STORMY DANIELS’ ATTORNEY MICHAEL AVENATTI SENTENCED FOR NIKE EXTORTION PLOT
On 8 July, USA Today and others reported that Michael Avenatti, 50, has been sentenced to 2½ years in prison for trying to extort up to $25 million from Nike by threatening the company with bad publicity.
SWEDISH CRYPTO SCAMMER SENTENCED TO 15 YEARS IN PRISON
On 8 July, CNBC reported that Roger Nils-Jonas Karlsson,47, has been sentenced in the US to 15 years in prison for securities fraud, wire fraud and money laundering charges. He defrauded over 3,500 victims of more than $16 million.
HOW DO YOU TAX A ROBOT?
A blog post from ICAEW on 8 July looks at the tax challenges regarding the increased use of AI and robots.
THE RIS OF THE “PRECARIAT”
On 8 July, a blog post from the Institute of Chartered Accountants in England & Wales was concerned with the growing gig economy, comprised of self-employed, flexible (and often poorly rewarded) workers, such as those “employed” by Uber. The post comes in the context of the UK Chancellor’s decision on aligning National Insurance Contributions for such self-employed with those for the employed. It seems a professor at SOAS (the London School of Oriental and African Studies) coined the term “precariat” who have a precarious existence and lack of real job security (or benefits, such as sick and holiday pay etc).
NEW YORK DEPARTMENT OF FINANCIAL SERVICES ANNOUNCES NEW GUIDANCE ON RANSOMWARE PREVENTION
On 8 July, an article from Jones Day reported that, on June 30, the New York Department of Financial Services (NYDFS) identified key cybersecurity measures to prevent and prepare for ransomware attacks. It announced that it recommends regulated financial entities implement to reduce the risk of ransomware attacks – in response to a significant increase of ransomware attacks reported by regulated entities to the NYDFS since January 2020.
THE GIBRALTAR-UK TREATY MUST BE ‘COMPATIBLE WITH EU INTERESTS’
On 8 July, the Gibraltar Chronicle reported that the President of the European Commission has said that the planned treaty governing the relationship with the EU must be compatible with both EU law and EU interests.
FinCEN ISSUES ASSESSMENT ON POSSIBLE “NO-ACTION” LETTERS FOR INDUSTRY
On 8 July, a post on Lexblog said that FinCEN issued on 30 June its 14-page assessment regarding the feasibility of FinCEN issuing so-called “no-action” letters to financial institutions. The Assessment is said to be full of specific, concrete details and offers interesting insights into how no-action letters may (or may not) work in practice. It posits that no-action letters are a desirable step, but that practical challenges remain.
FOREIGN OLIGARCHS AND THE ART OF LAUNDERING: HOW DARK MONEY THREATENS US ALL
On 8 July, an article in Forbes magazine argues that the trade in art lends itself to such malpractice owing to the privacy and opacity of deals, and that the global art market is integral to the alternate dark money economy deployed by authoritarian regimes to stay in power and subvert Western-style democracies. The author of the article includes art alongside currency substitutes such as oil, gold, uranium, cryptocurrency, narcotics and dark money havens such as real estate, big soccer teams and the like. The article looks at how the system works, and how art can become currency. It points out that one advantage to the oligarch or launderer, the key here is that, particularly with the contemporary art, nobody knows the true value of anything resembling art since there’s no sure way determining it – there’s no commonly agreed measure of skill or quality or beauty as a universal criterion; unlike gold and oil and real estate. The latest such vehicle is the NFT or Non-Fungible Token.
CAUTIOUS OPTIMISM ON SOUTH-EAST ASIA MARITIME PIRACY RISK
On 7 July, an article from Risk Intelligence said that the actions of Malaysian and Philippines forces have apparently curbed the activities of the Abu Sayyaf terrorism group, notorious for kidnap-for-ransom.
CANADIAN COMPANY FILES FURTHER CLAIMS AGAINST KYRGYZSTAN OVER KUMTOR GOLD MINE
On 8 July, Rferl reported that Canada’s Centerra Gold says it has filed additional arbitration claims against the Kyrgyz government as it battles for control of the Central Asian country’s Kumtor gold-mine project. This comes after the government moved to temporarily take over operations at the mine for what President Sadyr Japarov said was a necessary move to remedy environmental and safety violations.
CANADA: THE FUTURE SUPERVISION OF AML BY THE OFFICE OF THE SUPERINTENDENT OF FINANCIAL INSTITUTIONS (OSFI)
An article from Dentons on 8 July explained that, in Canada, both OSFI and the Financial Transactions and Reports Analysis Centre (FINTRAC) have roles to play in AML/CFT and, historically, OSFI has assessed the effectiveness of a federally-regulated financial institution’s AML/CFT programmes. FINTRAC’s responsibility is to ensure AML/CFT compliance. The article mentioned the response to a recent consultation on the future of OFSI’s role, and that OFSI plans to delete the guideline rule setting out its role in deterring and detecting money laundering and terrorist financing. However, OSFI will still has oversight of any money laundering/terrorism financing risk that could have an impact on an institution’s financial soundness. The regulator will also continue to coordinate and share information with FINTRAC as required, and in keeping with international best practices.
CENTRAL BANK DIGITAL CURRENCY (CBDC): THE BATTLE FOR THE SOUL OF THE FINANCIAL SYSTEM
On 8 July, a post on VOX from the Centre for Economic Policy Research says that central banks are thinking about whether they should substitute publicly issued digital currency for the bank-issued digital money that people use every day. It also says that how this plays out can profoundly reshape the financial system and make it less stable.The post argues that we don’t need CBDC to solve financial system problems, but that with China already headed down the CBDC road, perhaps the best hope is that central banks will all proceed very slowly and stop well short of universal, elastically supplied, interest-bearing digital currency.
THE 4 LEVELS OF SUPPLY CHAIN RISK
On 2 May, Global Trade Magazine carried an interesting article saying that supply risk can take many forms and can manifest anywhere in the supply chain process, and that a holistic approach to supply risk management is built around 4 different levels of supply risk –
- assessments should always start at the value chain level;
- to recognise the inherent factors that influence risk for a specific category;
- risk across the supply base; and
- individual supplier risk
WHY IS GLOBAL AIR CARGO DEMAND ON THE RISE?
On 24 June, an article in Global Trade Magazine posed this question, saying that according to aviation industry trade body IATA, the demand for global air cargo reached its highest level since IATA began collecting the data in 1990. In March 2020, the demand was 4.4% higher than in March 2019 – but March 2020 was the month before the Covid-19 outbreak took full effect. The article seeks to explain why demand for air cargo capacity remains at an all-time high, despite (or even, to some extent, because of) the pandemic; although growth did apparently slow down earlier this year.
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