On 20 July, the Cyprus Mail reported that an EU report has said that Cyprus has made some progress toward tweaking its justice system, but there remains work to be done on improving transparency and accessibility to public documents, mechanisms to combat corruption, and full disclosure of the assets of elected officials. The report also refers to important reforms remain pending – such as setting up an anticorruption agency, protection of whistleblowers, regulation of lobbying and asset disclosure for elected officials. It also says that the investigation of corruption cases continued, with the manipulation of sports competition stands out as a particular risk area, although adjudication of corruption cases remains low. It also mentions the inquiry launched into the citizenship-by-investment scheme, looking into allegations of corruption involving foreign individuals and high-ranking officials.
On 20 July, an article from NAVEX Global says that, with less than 6 months now to go until the 17 December deadline for Member States to transpose the Whistleblower Protection Directive, progress is still very mixed. Only Denmark has completed the transposition of the Directive, with the new Whistleblower Protection Act passed on 24 June.
On 20 July, the EU issued a news release as a Q&A on the EU AML/CFT package and its 4 legislative proposals. It is said that these 4 proposals together constitute an ambitious set of measures to modernise the EU’s AML/CFT regime.
On 19 July. Elliptic carried an article which follows a real case involving the REvil ransomware – from initial infection and negotiation, through to the cryptocurrency payment and laundering of the funds.
On 14 July, ACFCS published an article in the light of the FinCEN release of AML priorities and Wolfsberg metrics of effectiveness. It says that the future of financial crime has “effective” compliance teams generating “highly useful” and “relevant” intelligence for investigators in focused, shifting defined “priority areas,” both broad generators of illicit income, like corruption and cyber-enabled fraud, but also attuned to the actions and reactions of international threat actor groups.
A news release from the US State Department on 20 July advised that it had designated former Honduran President Porfirio “Pepe” Lobo Sosa (Lobo) and former First Lady Rosa Elena Bonilla Avila (Rosa Lobo) due to their alleged involvement in significant corruption. It is said that President Lobo accepted bribes from the narco-trafficking organization Los Cachiros in exchange for political favours, and Rosa Lobo engaged in significant corruption through fraud and misappropriation of public funds for her personal benefit. They and their immediate family members are ineligible for entry into the US, along with the designation of the following members of the Lobos’ immediate family: their son, Fabio Porfirio Lobo; their daughter, Ambar Naydee Lobo Bonilla; and the Lobos’ minor child.
On 20 July, a Commentary from RUSI asks, as the UK’s human rights sanctions programme marks its first anniversary, how has the government used its new powers? Who has been sanctioned, where and why? For example, it points out that the largest share of those sanctioned – a total of 29 – are in Russia, followed by Saudi Arabia with 20.
On 16 July, Mayer Brown published an article saying that, on 12 July, the EU issued guidance on due diligence for EU businesses to address the risk of forced labour in their operations and supply chains. The non-binding Guidance is intended to provide companies with practical advice on the use of existing international due diligence instruments and does not create any new legal obligations. The article considers who is covered by the guidance, what should be covered by the due diligence procedures and what companies should do – especially if problems are encountered. Among other things, the article introduces a new (to me anyway) abbreviation – HRDD (human rights due diligence).
On 15 July, an article from TLT refers to a recent Home Office Circular clarifying how SAR should be disclosed in civil litigation. However, the article says, the guidance is in very general of terms and leaves some specific circumstances unaddressed. For example, it notes that the Circular does not cover SAR made under the Terrorism Act 2000. Use in litigation is tricky, it suggests, as disclosing that a SAR has been filed or that a money laundering investigation is being undertaken may amount to the offences of tipping off or prejudicing an investigation. The article highlights the importance of separate internal processes, i.e. separate from the preparation and filing of the SAR, avoid references to SAR in internal documentation about decisions to terminate or exit a customer and to focus on other factors to end a relationship with a customer. The article also looks at when a SAR might be disclosable. It urges businesses to put in place internal processes which make a clear distinction between a SAR and the other commercial reasons to exit customers or to suspend account access where money laundering is suspected.