A briefing from the Security Assistance Monitor says that the US remains the world’s largest purveyor of arms. US lawmakers and advocates have long sought to create safeguards against the misuse of the billions in US weaponry shipped abroad every year. It says that end-use monitoring (EUM) is intended to be the answer to those concerns and is aimed at satisfying statutory requirements for the US Government to provide assurances that arms are not being misused, diverted, or otherwise violating the terms of their export. Unfortunately, it says, the current EUM regime fails to address today’s concerns about the human impact of US arms transfers. The briefing is intended to give an overview of current EUM policies, dispel commonly held misconceptions of current EUM practice, and offer recommendations for how these regulations could be strengthened.
On 20 September, Legal Futures reported that a law firm owner who ignored AML responsibilities – and even overrode a negative due diligence check – has been banned by the Solicitors Disciplinary Tribunal (SDT) from holding compliance roles. Silas Ogbonna also failed to undertake a simple internet search that would have told him that one of his clients was a PEP, triggering extra obligations.
On 14 September, Nishimura & Asahi published an article about the results contained in the recent FATF mutual evaluation report on AML/CFT in Japan. Like many other states (as the article explains), Japan has been placed in enhanced follow-up. The article examines the findings of the MER and the action plan initiated by the Japanese government to close gaps that have been identified.
Panama Covid-19 update – numbers of new cases and active cases continue to fall, the number of new infections being 18.5% down this week compared to the previous one. Today has seen 250 more new cases and 2 new fatalities reported, with there now being 4,033 active cases – 64 in ICU and 244 in other wards.
Any modest contributions for my time and ongoing expenses are welcomed! I have a page where you can do so, and where one-off contributions start as low as $3, athttps://www.buymeacoffee.com/KoIvM842y
19 SEPTEMBER 2021
GERMANY: PANAMA DENOUNCES AUCTION OF ARCHAEOLOGICAL ARTEFACTS CLAIMED TO HAVE BEEN ILLEGALLY TRAFFICKED
On 18 September, Critica and others reported that the Panmanian government had protested the planned sale of 7 items said to be of the Panamanian Pre-Colombian period. Mexico and Guatemala have also lodged protests against the sale of items by the auction house in Munich.
On 18 September, TVN reported that a trial due to begin on Monday, 20 September in Panama City could be being delayed until November or December. Among the defendants are the founders of the Mossack Fonseca law firm at the heart of the scandal – Ramón Fonseca Mora and Jürgen Mossack.
PAKISTAN: BANKER ARRESTED ON CHARGES OF ATTEMPTING TO INFLUENCE WITNESSES IN MONEY LAUNDERING CASE
On 19 September, ARY News reported that Muslim Commercial Bank (MCB) vice-president Asim Suri had been detained on charges of influencing witnesses in a money laundering case against PML-N president Shehbaz Sharif and others. He and MCB Group Head, Azhar Mahmood, were allegedly coercing prosecution witnesses, including bank officials, into changing their statements. Shehbaz Sharif is a Pakistani politician and the Leader of the Opposition in the Provincial Assembly of the Punjab.
On 18 September, the Libya Observer reported that the Sudanese Rapid Support Forces (RSF) had announced that it had foiled an attempt to smuggle a shipment of weapons and explosives and arrested 4 individuals, amongst them foreigners, from a gang involved in illegal arms trade with Libya. It is said to have seized 2 GMC cars carrying 36 Kalashnikov rifles and 2 boxes of grenades in addition to the DShK cannon, an RPG-7 launcher, and a large number of ammunitions of various kinds.
PHILADELPHIA CUSTOMS OFFICERS SEIZE NEARLY $100,000 IN COUNTERFEIT CURRENCY FROM RUSSIA
A news release from US Customs & Border Protection on 15 September advised that the counterfeit euros and dollars were shipped in international air cargo from Russia and destined to an address near Chicago. It was manifested as ‘Play Money for Monopoly”.
500 ILLEGAL CRYPTO MINING FARMS INTERCEPTED IN KYRGYZSTAN
On 18 September, Cryptopolitan reported that Kyrgyzstan authorities have busted 500 crypto mining farms that were illegally operating in the country. It is said that they draw an excessive amount of energy from the power grids that often results in a shortage of power supply.
FORMER CHIEF OF RUSSIA’S WEX (BTC-e) CRYPTO EXCHANGE ARRESTED IN POLAND
On 17 September, the Coin Telegraph reported that Dmitry Vasiliev, the former chief of Russian cryptocurrency exchange Wex, has been arrested in Warsaw. Wex, which was previously known as BTC-e, was a well-known “dark” exchange in the early days of the cryptocurrency industry.
An article from the Center for Strategic and International Studies published an article on 15 September about options for changes to the US policy on remittances, which are relied upon by many people in Cuba. More than 90% of the Cuban diaspora is in the US, and hence most remittances come from there. By 2019, there were over 1.3 million Cuban-born persons living in the US, making Cubans and Cuban Americans the third-largest diaspora from the Americas — surpassed only by Mexico and El Salvador. There are formal and informal ways to send money to Cuba. However, it points out that, instead of hard cash, citizens are given “electronic” dollars, which can only be used at government-owned (GAESA) stores with higher prices. As a result, research is said to show that for every $1 of remittances sent via Western Union and later spent in GAESA shops, the military gains 74 cents, 61 cents of which comes directly from store sales.
JAMAICA: CONTROVERSIAL NEW DIGITAL ID BILL THAT WOULD STORE CITIZENS’ BIOMETRIC INFORMATION COULD BE REPLICATED ACROSS THE CARIBBEAN
A post from Coda on 15 September reported on efforts to roll out a digital ID system that would provide Jamaicans with a national identity card while collecting their personal information and biometric data. It highlights objections to the Bill are part of a wider range of concerns — from privacy to human rights — surrounding the island nation’s biometric National Identification System (NIDS) as it heads into a likely vote in the Parliament this month. It is also said that that conversations about new digital ID systems are already underway in neighbouring Barbados, St. Lucia and the Dominican Republic. Concerns are also expressed about data protection and security, with a recent instance in which a government contractor allowed immigration documents and coronavirus test results of hundreds of thousands of travellers to Jamaica exposed on the Web.
WEBINAR:’ UNPICKING THE PROPOSED UK REGIME ON INTERNATIONAL DATA TRANSFERS. DIVERGENCE FROM THE EU?’
On 23 September, Field Fisher is to hold a webinar after the ICO in the UK launched a consultation on many aspects of international data transfer compliance under UK law. It will discuss the 3 main items of the consultation, the practical implications for those transferring data out of the UK and explore differences from the EU regime.
US: INDIAN NATIONAL JAILED FOR 22 YEARS FOR $10 MILLION ROBOCALL SCAM
On 17 September, Eastern Eye reported that an Indian national has been sentenced to 22 years in jail for defrauding over 4,000 people in the US of more than $10 million. Shehzadkhan Pathan, 40, operated a call centre in Ahmedabad from which automated robocalls were made to victims. A variety of schemes were used to convince victims to send money, including impersonating law enforcement officers from the FBI, DEA and representatives of other government agencies, and threatened victims with severe legal and financial consequences.
MALI: JUNTA DISMISSES WARNINGS NOT TO HIRE RUSSIA’S VAGNER ‘MERCENARIES’
On 19 September, an article from Rferl said that Mali’s ruling junta had dismissed warnings by Western governments not to hire “mercenaries” from private Russian security firm Vagner, saying it will do as it sees fit. Both France and Germany have said that a deal with Vagner would call into question their military commitments to the country.
The UAE Central Bank has published this guide containing an investigations and pro-active risk analysis of emerging risks likely to be prevalent across the financial sector in UAE. It takes into account inherent financial crime risk, current COVID-19 pandemic impact, and the business environment. One section is concerned with typologies observed from March 2019 – March 2021 and the heightened external fraud threat on account of COVID-19.
PANAMA COVID-19 UPDATE – while 255 new cases were reported today, there was only reported fatality, and both overall active cases and ICU numbers continue to fall, albeit slowly. There are now 4,059 active cases, with 64 in ICU and 238 in other wards.
Meanwhile, from Monday, 20 September, curfew measure will be completely lifted in the provinces of Darién, Bocas del Toro and the Guna Yala region. The 0100-0400 curfew will remain in force elsewhere, such as where we are in Panama City. In addition, churches, temples, parishes, chapels, chapels and other centres of worship will be permitted a maximum of 80% vaccinated occupancy (but only 50% unvaccinated), but with social distancing to be maintained.
18 SEPTEMBER 2021
UKRAINE SANCTIONS RUSSIANS OVER ELECTIONS IN OCCUPIED TERRITORIES AND NAVALNY POISONING
On 18 September, the Kyiv Post reported that the National Security and Defense Council had imposed sanctions on 86 Russians involved in the Russian parliamentary election being held on the occupied territory of Crimea and the Donbas. The list includes 33 State Duma (Russian parliament) candidates and 53 Russian territorial electoral commission members overseeing the 2021 Russian parliamentary election.
US AIMS TO HIT REVENUE STREAMS OF RANSOMWARE GROUPS WITH SANCTIONS
On 17 September, KION and others reported that the Biden Administration plans to impose new sanctions to disrupt the source of revenue of ransomware groups that have extorted major US firms of millions of dollars. OFAC also plans to issue updated guidance to companies on how to avoid breaking US law when making ransomware payments to cybercriminals.
BANGLADESH-INDIA BORDERS HAVE BEEN WITNESSING A RAPID INCREASE IN WILDLIFE SMUGGLING THROUGHOUT THE YEAR
On 18 September, the Business Standard reported that Bangladesh has long been a ground for collecting and illegally exporting exotic animals to India. A recent report by the Wildlife Conservation Society said exotic animals in Bangladesh such as Bengal Tigers, elephants, deer, pangolins, snakes, birds, and turtles are under serious threat. Since the end of 2019, 438 cases of wildlife trafficking were recorded by the Wildlife Crime Control Unit (WCCU) of the Bangladesh Forest Department and, according to the Hindustan Times, the BSF had seized at least 25 consignments of exotic animals till October 2020 throughout the year.
On 17 September, the IMF released an Article IV report on Malta. Amongst its findings, on AML/CFT it said that – progress has been made in addressing a number of shortcomings in the AML/CFT framework, but challenges continue, and in June 2021, the FATF put Malta under increased monitoring (i.e. the “grey list”). In July 2019, Moneyval identified significant deficiencies with Malta’s AML/CFT framework. The authorities have since stepped up efforts to improve their understanding of money laundering and terrorist financing risks, enhanced AML/CFT supervision (including through the adoption of new risk-based tools), issued sector-specific AML/CFT guidance, implemented institutional changes to improve enforcement of cases, and created a new Asset Recovery Bureau. In late April 2021, Moneyval recognised Malta’s progress in technical compliance with the FATF Standards. However, due to remaining concerns over the effectiveness in implementing some aspects of the AML/CFT framework, in June 2021, the FATF put Malta on the “grey-list”. The IMF said that –
On 14 September, Dixcart reported that from 1 January investors will be blocked from buying properties in high-density areas such as Lisbon, Oporto and the Algarve. In addition, investment in any one of the non-real estate routes, will be required at increased levels. The changes (detailed in the article) are designed to drive investment towards Portugal’s low-density population areas, relieving pressure on higher density areas such as Lisbon, Oporto and the Algarve. Investment levels will also be increasing for each of the Golden Visa routes.
ST KITTS AND NEVIS CITIZENSHIP BY INVESTMENT: PRICE REDUCTION
On 14 September, Dixcart reported that the price reduction in relation to the St Kitts & Nevis Citizenship by Investment Programme, comes to an end on 31 December. The Programme grants qualified applicants instant visa-free access to over 150 countries and it is one of the oldest and most respected programmes of its kind. There is no requirement to travel to St Kitts & Nevis and there are no annual residency rules to maintain the passport.
NFT: TRADITIONAL COPYRIGHT ISSUES IN A TOKENISED WORLD
On 17 September, an article from Smart & Biggar was concerned with Non-Fungible Tokens (NFT), the latest development in disruptive blockchain technology innovations, this time in the world of digital art, collectibles, and even luxury goods. It says, amongst other things, that purchasers of NFT should be aware that even though ownership of the authentic digital asset is established through ownership of the NFT, the digital asset itself may be viewed, downloaded, and enjoyed by anyone. It goes on to say that, drawing parallels from the physical art world, owning an NFT is like owning a unique print of a piece of art signed by the artist, while multiple other individuals may simultaneously own identical unsigned prints. As discussed below, the artist retains the copyright in the underlying work; and that purchasing an NFT does not confer the underlying copyright in the digital work.
CHINA: USE OF INTERPOL TO REPATRIATE DISSIDENTS – THE CASE OF YIDIRESI AISHAN
On 9 August, Estlund Law carried a post about the case of Yidiresi Aishan, a private citizen and Uyghur activist in exile from China’s north-western region of Xinjiang, a predominantly Turkic-speaking ethnic group primarily from China’s north-western region of Xinjiang. A 34-year-old computer engineer and father of 3, he has resided in Turkey since 2012. He is said to have been employed as a web designer who also worked on a Uyghur diaspora online newspaper and assisted other activists in media outreach and collecting testimonies of abuse in China’s Xinjiang province. It is said that CCF, the commission that controls INTERPOL files, has blocked the Red Notice for Yidiresi Aishan.
UK: POLICE UPDATE NOTICE FOR PERMISSION TO SEARCH FOR RELEVANT INFORMATION ON DIGITAL DEVICES
On 16 September, the National Police Chiefs’ Council reported that a new form had been introduced after extensive consultation, including with victims’ groups, and police will also provide an additional ‘easy read’ version of the form. Replacing a temporary version introduced in September 2020, it is intended to help police and prosecutors balance the need to follow all reasonable lines of enquiry with the need to respect the privacy of victims and witnesses, while meeting disclosure obligations. The new Digital Processing Notice and supporting information to gain permission for searching digital devices has been launched across police forces in England and Wales. Examples of the forms are attached to the article from the NPCC.
NEW PAPER: OVERVIEW OF NUCLEAR SECURITY ARCHITECTURE AND AREAS OF WEAKNESS AND WAYS TO CLOSE GAPS
On 14 September, the Nuclear Threat Initiative organisation said that a new paper on the Global Nuclear Security Architecture finds significant limitations to the current patchwork that includes individual states’ domestic regulations and policies, informal groups of countries voluntarily working together to enhance certain aspects of nuclear security, and more formal binding treaties and international organisations that make up the global nuclear security architecture. It addresses evolving risks of nuclear terrorism and the enormous consequences that would result in terms of loss of life, health risks, damage to the environment, economic costs, or reduced public confidence in the continued use of peaceful nuclear technology.
FOREIGN DIRECT INVESTMENT (FDI): AN OVERVIEW OF THE EU AND NATIONAL CASE LAW
A paper from Clifford Chance says that, in recent years, we have seen the arrival of a new wave in FDI policymaking. FDI compliance has now become a top priority for investments within the EU for a broad range of sectors, defined as critical infrastructure (energy, transport, water, health, communications, media, data processing, or storage, aerospace, defence, electoral or financial infrastructure, sensitive facilities, and crucial real estate) and critical technologies (AI, robotics, cybersecurity, energy storage, nuclear technologies, nanotechnologies, and biotechnologies). The paper provides an overview of the developments in FDI regimes globally during 2021 and, more specifically it highlights the trends over the year in the EU and in a number of key EU Member States together with the UK. It involves an added focus on the reasons why FDI screening increasingly matters.
FORENSIC INVESTIGATIONS v CLAIMS TO LITIGATION PRIVILEGE – INCOMPATIBLE?
On 15 September, an article from Clyde & Co is concerned with a recent High Court case in England which it says provides a useful reminder of the risks posed to claims to litigation privilege in circumstances where the communication(s) in question may be referable to several competing motives. As ever, it says, the courts look at the substance rather than the form when assessing a claim to litigation privilege. The litigation privilege test is assessed as at the time of the communication, not wearing the spectacles of hindsight, and if the client has regulatory motivations for the instruction, it may increase the chance that litigation privilege will not apply.
CANARY ISLANDS TOURISM INDUSTRY BUILT ON WESTERN SAHARAN SAND
On 14 September, ENACT Africa reported that the sand trade between the Canary Islands and Western Sahara flouts international rulings over the latter, an occupied territory. It is said that the Canary Islands requires enormous quantities of sand to build amenities, hotels and housing for its tourism industry, and building companies source their sand from Western Sahara. It notes that the Court of Justice of the EU has ruled that any agreements between the EU and Morocco cannot be legally extended to Western Sahara. The only exceptions are those agreements that have the explicit approval of the people of the territory and which aim to benefit the immediate needs of the original Saharawi population. It is estimated that at least 750 000 tonnes were illegally extracted from Western Sahara and transported to the Canary Islands between 2012 and 2017.
On 17 September, an article from the Atlantic Council said that for months, the Biden Administration warned that it would sanction the Ethiopian government and its allies for the human-rights abuses, war crimes, and other mass atrocities they have allegedly committed in their year-long war with the Tigray People’s Liberation Front (TPLF). It says that now the Administration has chosen to issue what the Treasury calls an “empty EO,” meaning a sanctions regime is now in place but the executive order does not designate any individuals or companies. Instead, the Biden team launched a final and most elaborate warning shot.
RUSSIAN OLIGARCH VOWS TO APPEAL SWISS DECISION TO DROP CASE AGAINST ART DEALER
On 17 September, Rferl reported that lawyers for Russian billionaire Dmitry Rybolovlev say he will appeal a decision by Swiss prosecutors to close his case against a top art dealer he accused of swindling him out of more than $1 billion. He had accused Swiss art dealer Yves Bouvier of inflating prices on 38 works he acquired from 2003 to 2014. It also notes that Rybolovlev was himself charged with bribery and influence peddling in Monaco. Those charges have implicated several former ministers, forcing one, the justice minister, to retire over claims he accepted bribes.
ARRESTS IN BOSNIA OVER MEDICAL EQUIPMENT PROCUREMENT
On 17 September, OCCRP reported that people suspected of “abuse of official position or authority” in multi-million-dollar purchases of COVID-19-related medical protection equipment have been arrested in Bosnia and Herzegovina. Police in Republika Srpska, the country’s Serb-dominated region, searched 8 locations around the city of Banja Luka. The suspects are accused of taking advantage of the pandemic emergency to acquire large property benefits through the public procurement procedures.
MONEYVAL CARRIES OUT EVALUATION VISIT TO LIECHTENSTEIN
On 17 September, the Council of Europe announced that a team of evaluators from MONEYVAL carried out an onsite visit to Liechtenstein from 6 to 17 September. The eventual mutual evaluation report is scheduled for discussion and adoption at MONEYVAL’s 63rd Plenary meeting in Spring 2022.
PANDEMIC SEES US PARCEL VOLUMES GROW BY NEARLY 40% IN 2020
On 17 September, Parcel & Post Technologies reported that US parcel volume grew 37% year-on-year, reaching 20 billion, up from 15 billion in 2019. In 2020, around 640 parcels were shipped per second, compared with 466 in 2019. Between 2015 and 2020, US parcel volume doubled from 10 billion to 20 billion.
OXYCONTIN CREATED THE OPIOID CRISIS, BUT STIGMA AND PROHIBITION HAVE FUELLED IT
On 16 September, an excellent article in The Conversation said that, as a settlement was announced in the case against Purdue Pharmacy, 2020 was the worst year on record, with over 93,000 Americans losing their lives to fatal drug overdose. The drug overdose epidemic, now more than 2 decades long, has claimed the lives of more than 840,000 people since 1999. It also says that it is estimated the 1.7 million people in the US now use pharmaceutical opioids without a prescription – not that much less than the number of those using heroin (2.3 million). After years of research, the author of the article says that she has found was an increasingly dangerous drug environment for people who use drugs, often exacerbated by policies not founded in research and by attitudes that harm those affected. The OxyContin opioid painkiller was released in 1996 and Purdue Pharma, its maker, is said to have knowingly downplayed its addictive potential. The unintended consequences of policy and enforcement changes is illustrated by the fact that, in 2010, Purdue Pharma replaced the original OxyContin with version that was more difficult to crush and inhale – unfortunately, many people who were addicted to OxyContin then turned to heroin. This in turn led to a growing market for heroin paved the way for synthetic opioid fentanyl into the illegal drug market. It looks at alternatives to US policies, saying that ignoring the evidence will surely cost many more lives.
SOUTH FLORIDA STILL NUMBER 1 IN HEALTHCARE FRAUD COSTING MEDICARE BILLIONS A YEAR
On 18 September, the Miami Herald reported that the region recently accounted for $308 million, or 20%, of the $1.4 billion in false healthcare claims nationwide, according to a 6-week snapshot of criminal cases released by DoJ. Federal prosecutors in South Florida have also charged 52 defendants with healthcare fraud, or more than one-third of the 138 defendants prosecuted nationwide during that same time frame.
TAIWAN: MAYOR, OFFICIAL AND OTHERS SENTENCED FOR CORRUPTION
In its 19 September edition, the Taipei Times reported that Pingtung Mayor Lin Hsieh-sung and Pingtung City Council Speaker Hsiao Kuo-liang, both members of the Chinese Nationalist Party (KMT), have been sentenced to several years in prison for corruption. 2 other defendants, a Pingtung County Council administrator and a contractor were also convicted on corruption charges.
ZIMBABWE: PRESIDENT MNANGAGWA BLOCKS PROSECUTION OF MINISTER OVER CORRUPTION
On 18 September, Bulawayo 24 reported that President Emmerson Mnangagwa is blocking attempts to bring to book the Minister of State for Masvingo, Ezra Chadzamira, who was arrested by investigators from the Zimbabwe Anti-Corruption Commission (Zacc).
INDIA: ENGINES OF POLICE PATROL BOATS STOLEN AND REPLACED WITH INFERIOR ONES
In its 19 September edition, The Indian Express reported that an investigation was ordered in January after a whistle-blower informed the Home Department in August 2020 that 23 engines had been stolen from boats deployed to patrol the Mumbai coastline, and replaced with old and low-powered engines – with the theft is alleged to have taken place in 2017-2018.
MOLDOVA: APROXIMATELY HALF A MILLION EUROS BELONGING TOFUGITIVE OLIGARCH SEIZED
On 18 September, ZDG in Moldova reported that the Agency for the Recovery of Criminal Assets within the National Anticorruption Center had announced that approximately €500,000, said to belong to Vladimir Plahotniuc, who faces allegations of money laundering, had been seized.
US TO REVIEW EXPORT POLICIES FOR ETHIOPIA, ERITREA, AND CYPRUS
On 17 September, Janes.com reported that the US State is preparing to add Ethiopia and Eritrea to its list of countries with a policy of denial for the transfer of military equipment under the International Traffic in Arms Regulation (ITAR), while extending its waiver for Cyprus. The updated policy toward Ethiopia and Eritrea came as a result of the recent conflict in the Tigray region in northern Ethiopia.
On 17 September, the Environmental Investigation Agency produced a report about illegal imports of HFC through Romania, and the lack of action by the authorities. It says that more than 2 months after Romania was revealed to be a major illegal entry point in the EU for Chinese-made, climate-harming HFC refrigerants, zero enforcement action has been taken. Although the precise scale of the illegal HFC trade cannot be accurately estimated, the EIA believes it is significant, likely between 20-30% of the legal trade.
Panama Covid-19 update – waiting to see if Panama makes it off the UK Red List on 1 October although, of course, the UK (rightly, in my opinion) remains on the Panama Red List.
Meanwhile, another 324 new cases and 3 new fatalities reported today, with there now being 4,199 active cases – 72 in ICU and 233 in other wards.
Any modest contributions for my time and ongoing expenses are welcomed! I have a page where you can do so, and where one-off contributions start as low as $3, athttps://www.buymeacoffee.com/KoIvM842y
17 SEPTEMBER 2021
EU GENERAL COURT HAS ANNULLED EARLIER ACTS RE-LISTING A FORMER MINISTER FOR AGRICULTURE, ANIMAL AND MARITIME RESOURCES UNDER EU’S LIBYA SANCTIONS
On 15 September, the EU Court of Justice issued a news release advising that the General Court had has annulled the 2019 and 2020 acts re-listing Abdel Majid Al-Gaoud, who in fact died in March 2021 and had been de-listed by the EU in April 2021. The case had been maintained by his son.
FACEBOOK: WEAK RESPONSE TO EMPLOYEES’ WARNING TO POSTINGS ON ILLICIT ACTIVITY
On 16 September, the Wall Street Journal article began by saying that in January a Facebook investigator revealed to staff that the Mexican cartels had been using Facebook to recruit. However, despite being in clear violation of Facebook’s rules, the company didn’t stop the cartel from posting on Facebook or Instagram. Having reviewed scores of internal documents the newspapers says that they show employees raising alarms about how its platforms are used in some developing countries, where its user base is already huge and expanding. They also show the company’s response, which in many instances is inadequate or nothing at all.
FOOD FRAUD AND COUNTERFEIT COTTON: THE DETECTIVES UNTANGLING THE GLOBAL SUPPLY CHAIN
On 16 September, the Guardian carried a report saying that in the complex web of international trade, proving the authenticity of a product can be near-impossible. It examines the work of a company named Oritain, founded in 2008, in Dunedin in New Zealand, is a kind of forensic detective agency – a supply-chain CSI. Oritain promises to determine with 95% accuracy if a coffee bean or a cut of meat is really from the source advertised on its label. The Guardian says that the counterfeit food market alone is worth $49 billion a year.
MALTA: WIFE OF FORMER PRIME MINISTER CHIEF OF STAFF ARRAIGNED ON MONEY LAUNDERING CHARGES
The Malta Independent on 17 September reported that the wife of former OPM chief of staff Keith Schembri has been arraigned on money laundering charges. Josette Schembri Vella is the wife of former OPM chief of staff Keith Schembri, who has also been charged with money laundering and corruption.
THE SWEDISH NARCOS ESCAPING THE COLD IN SPAIN’S COSTA DEL SOL
On 17 September, El Pais carried a report saying that criminal gangs have moved to Málaga province, taking their extremely violent tactics with them. They are feared for their cold-blooded modus operandi and their ability to penetrate any sector of society, and Marbella is their logistics hub. Swedish police’s National Operations Department (NOA) has confirmed this and add that the gangs are also gravitating to the Costa del Sol because of the popularity of Marbella.
HIGH-LEVEL GROUP TO START REFLECTION ON FUTURE OF EU CUSTOMS UNION
On 17 September, the EU advised that the Commission has announced the launch of a new special group tasked with identifying innovative solutions for the most pressing challenges facing the EU’s Customs Union. The ‘Wise Persons Group on Challenges Facing the Customs Union’ will advise EU institutions and Member States on how to prepare for new business models and technological developments, and how to efficiently manage the Customs Union to ensure agile and robust customs processes to accelerate the digital and green transitions.
MAN WITH EAST BELFAST UVF LINKS TO HAND OVER £60,000 PROCEEDS OF CRIME
A news release from the NCA on 17 September advised that a man with suspected links to the paramilitary East Belfast Ulster Volunteer Force has been ordered to hand over £60,000 proceeds of crime. The settlement figure comprises the proceeds from the sale of a motorhome (£45,000), plus an additional amount of £15,000, all suspected of having been acquired through the proceeds of fraud offences and money.
KYRGYZSTAN ADDS FORMER LEADERS OF CANADA’S CENTERRA GOLD TO WANTED LIST
On 17 September, Rferl reported that Kyrgyzstan has added several former leaders of Canada’s Centerra Gold company and its operator of the Kumtor Gold company to its wanted list as part of a widening investigation into alleged corruption during the development of a major gold-mining project. It is alleged that the former leaders of the Canadian company and its operator had been involved in “corrupt” activities through which they illegally pocketed up to $200 million in December 2013.
UK: FIRST-EVER PROPERTY DEAL USING THE NEW QUALIFIED ELECTRONIC SIGNATURE (QES) BEING TRIALLED BY HM LAND REGISTRY
On 17 September, Legal Futures reported that QES is a more advanced form of electronic signature that does not need to be witnessed, with the signer’s identity verified by a ‘qualified trust service provider’ – an independent checker.
US: FRAUDSTER SENTENCED TO PRISON FOR LONG RUNNING PHONE UNLOCKING SCHEME THAT DEFRAUDED AT&T
A news release from US DoJ on 17 September advised that Muhammad Fahd, a citizen of Pakistan and Grenada, has been sentenced to 12 years in prison for his leadership role in a 7-year scheme to unlawfully unlock nearly 2 million phones to defraud AT&T Inc, inflicting more than $200 million in losses. Beginning in 2012, Fahd, 35, conspired with others to recruit AT&T employees at a call centre to unlock large numbers of cellular phones for profit.
FOUNDER OF $90 MILLION CRYPTOCURRENCY HEDGE FUND SENTENCED TO MORE THAN 7 YEARS IN PRISON
A news release from US DoJ on 17 September advised that Stefan He Qin, the founder of the Virgil Sigma Fund LP and the VQR Multistrategy Fund LP, a pair of cryptocurrency hedge funds in New York which claimed to have over $100 million dollars in investments, has been sentenced to 90 months in prison. It is reported that Qin’s investors discovered that his strategies weren’t much more than a disguised means for him to embezzle and make unauthorised investments with client funds. When faced with redemption requests he couldn’t fulfil, Qin doubled down on his scheme by attempting to plunder funds from VQR to satisfy his victim investors’ demands.
BITCOIN LEDGER AS A SECRET WEAPON IN WAR AGAINST RANSOMWARE
An article from Coin Telegraph on 16 September said that following the Colonial Pipeline hack, and using blockchain analysis, the FBI was able to follow the ransom payments fund flow and recover about 85% of the Bitcoin paid to ransomware group DarkSide. In fact, it says, blockchain analysis, which can be further enhanced with machine learning algorithms, is a promising new technique in the battle against ransomware. It takes some of crypto’s core attributes — e.g., decentralisation and transparency — and uses those properties against malware miscreants. It concludes by saying that continued advancements in blockchain analytics will provide investigators with more and even better insights over time, and as law enforcement agencies become increasingly adept in their use of these analytic tools, one can expect to see more, and bigger, ransomware seizures over time.
REASSESSING COUNTER TERRORISM FINANCING IN A TALIBAN-CONTROLLED AFGHANISTAN
On 17 September, an article from Just Security said that Taliban’s rapid takeover of Afghanistan set back decades-long efforts to integrate Afghanistan into the international community, including from an AML/CFT perspective. This is said to have been a policy area in which Afghanistan made substantial progress over the past several years to raise compliance standards. It is said that understanding Afghanistan’s post-9/11 economic history allows policymakers to better address the current crisis. It is said that the informal, lightly-regulated hawala financial system predominates in Afghanistan as most Afghans remain excluded from the formal banking system, and the catastrophic 2010 Kabul Bank collapse, sparked by high-level corruption, had also shattered confidence in the Afghan banking system. Due to economic sanctions against the Taliban and the limited financial connectivity in Afghanistan, the hawala system served as the primary financial lifeline for the Taliban – prompting the US Treasury to seek to combat such use. The article makes a number of recommendations for lawmakers in the US in the light of the Taliban takeover, and its control of the central bank and access to, and use of, hawala. For example, it recommends that the US and the international community must hold the Taliban responsible for fulfilling the previous Afghan government’s commitments to providing appropriate supervision of both the banking and hawala sectors and implementing key reforms of the hawala sector. It also says that cooperation with the Taliban government to combat common enemies (such as ISIS-K), as well as modifying the definition of the Taliban etc in US measures as, in the absence of clear guidance about the scope of the Taliban sanctions, prudent actors will likely treat the counterterrorism sanctions against the Taliban as a de facto jurisdictional sanctions programme against the country of Afghanistan as a whole.
On 27 May, the IMF released this Working Paper estimates the magnitude of the eﬀect of a state being added to its Grey List by FATF using an inferential machine learning technique. It ﬁnds that grey-listing results in a large and statistically signiﬁcant reduction in capital inﬂows.
On 17 September, FATF-style regional body MONEYVAL reported that a team had undertaken an onsite evaluation of the AML/CFT systems in Bulgaria. Carried out on 6 to 17 September, the onsite visit is an essential part of the mutual evaluation review of the country, and the report will be scheduled for discussion and adoption at MONEYVAL’s 63rd Plenary meeting in Spring 2022.
CRIMINALS IN OTHER REGIONS LIKELY TO BE WATCHING SUCCESS OF GULF OF GUINEA PIRATES WITH INTEREST
On 16 September, an article in Insurance Marine News reported that the increase over the past few years in the level of kidnapping for ransom in the Gulf of Guinea is almost certainly being watched with interest by criminals in other coastal states with delta regions. This was a conclusion of an expert panel discussion hosted by law firm Ince.
ASSESSMENT OF MONEY LAUNDERING, TERRORIST FINANCING AND ILLICIT FINANCIAL FLOWS LINKED TO MARITIME CRIMINALITY IN THE GULF OF GUINEA
FATF-style regional body GIABA, which covers West Africa, has released a news release saying that it was seeking to recruit individual consultants to conduct country-specific studies on money laundering, terrorist financing and illicit financial flows linked to maritime criminality in the Gulf of Guinea. Expressions of interest are required by 30 September. The news release remonds one that the wider Gulf of Guinea, stretching from Cape Verde to Angola, is a major transit hub and facilitator of the region’s rapid economic growth which has averaged 7% since 2012. The Gulf of Guinea has also become a hub for global energy supplies with significant quantities of all petroleum products consumed in Europe, North America, and Asia transiting this waterway – but the number of attacks on shipping in the Gulf of Guinea is alarmingly high.
EU GENERAL COURT HAS DISMISSED THE APPLICATIONS OF 10 DEMOCRATIC REPUBLIC OF THE CONGO (DRC) NATIONALS AGAINST SANCTIONS LISTING
On 17 September, the EU Sanctions blog reported that the General Court had rejected the applications of 10 DRC nationals, including former officials, to annul their 2019 targeted sanctions re-listings.
20 YEARS AFTER 9/11, TERRORISTS COULD STILL GO NUCLEAR
An article from the Belfer Center (one of a series) said that investigations after the 9/11 attacks uncovered focused Al Qaeda efforts to get nuclear, biological, and chemical weapons. This nuclear programme reported directly to Ayman al-Zawahiri, now the leader of the group, and got as far as carrying out crude but sensible conventional explosive tests for the bomb programme in the Afghan desert. Weeks before 9/11, Osama Bin laden and Zawahiri met with 2 senior Pakistani nuclear scientists and discussed how Al Qaeda could get nuclear weapons. The article states that Al Qaeda has not managed to carry out a single successful attack in the US since 9/11, and asks if a terrorist nuclear attack is still something to worry about?
LAUNCH OF THE UN MANUAL OF GUIDANCE FOR COUNTERING KIDNAPPING AND EXTORTION
On 15 September, the UN Office of Counter-Terrorism (UNOCT) and the UN Office on Drugs and Crime (UNODC) launched this Manual dealing with Kidnap for Ransom Project (KFR). It seeks to provide Member States with good practices, tactics and strategies identified by experienced practitioners in the field of investigation of kidnapping from around the world. It is designed to be of assistance to policymakers, senior law enforcement officials and practitioners involved in the prevention and investigation of kidnapping and extortion offences.
UKRAINIAN PARLIAMENT TAKES STEPS TO IMPROVE CORPORATE GOVERNANCE
On 16 September, CMS Law reported that, on 15 July, the Ukrainian Parliament passed the first reading of the Draft Law “On Amendments to Certain Ukrainian Legislative Acts About Improving Corporate Governance of Legal Entities, for which the State is the Shareholder (Founder, Participant)” – part of a process of improving the corporate governance of state-owned companies. The article considers the chnages that would be made by the law, if enacted.
A COMPARATIVE STUDY OF WORLD BANK AND OTHER CORRUPTION-BASED EXCLUSION SYSTEMS
On 16 September, the GW Law Government Procurement Law Program co-hosted a webinar with the World Bank Office of Suspension & Debarment and the ABA International Anti-Corruption Committee, where a panel of experts discussed the recently published Global Suspension & Disbarment Directory, the first-ever consultative resource on exclusion systems where corruption has been found. The Directory captures data and information on the exclusion systems of 23 different countries and institutions and is for anyone interested in learning about how these jurisdictions employ exclusion to prevent wayward suppliers from accessing public funds.
The video of the presentation and panel discussion is at –
On 17 September, the Atlantic Council published the latest edition of this publication which reviews the Summer’s designations and delistings with data visualisations and breaks down how China has applied its new Anti-Foreign Sanctions Law. It explores the current state of sanctions against the Taliban and the growing effort to combat global corruption and human rights abuses through sanctions policy. Since the start of this year, China has more than doubled its total sanctions. But its expanding regime is no aberration. Since January, Russia, France, Switzerland, Canada, the EU, UK, and US have all seen a substantial increase in their total sanctions. In fact, the only major listing authority that has not seen a total increase has been the UN.