Panama Covid-19 update – it is reported that 2022 will see country fairs go ahead, but that entry to such events will be subject to proving one is fully vaccinated.
Meanwhile, one “industry” seemingly unaffected by the pandemic is drugs trafficking, as it is reported that security forces in Panama have seized a record 98 tons of drugs so far this year – more than in the whole of 2020 (84.8 tons). 2019 saw 90 tons seized and 2018 75 tons.
Today has seen another 150 new cases repoirted, and 1 new fatality. Active cases shows a significant drop in numbers, to 2,277; with 31 in ICU and 166 in other wards.
23 OCTOBER 2021
CLARIFYING TERRORISM FINANCING RISK IN EUROPEAN CROWDFUNDING
This briefing from RUSI says that a new financial technology (fintech) highlighted as a potential avenue for terrorism financing (TF) is crowdfunding: collecting funds online from many sources, in order to finance a project, business, loan or other endeavour. This is said to have enjoyed a recent burst of exposure because of its reported significance to extreme right-wing (XRW) groups. This is not a new concern, FATF listed crowdfunding among its emerging global TF risks in 2015. After looking at the theoretical and practical risks, the paper considers the implications for counterterrorist financing.
GERMAN INTERIOR MINISTER WARNS IRAQI OFFICIALS OVER PARTICIPATION IN OPERATIONS TO TRANSPORT REFUGEES TO THE EU VIA BELARUS
On 23 October, Republic World reported that the interior minister has warned Iraqi officials that their participation in operations to transport refugees to the EU via Belarus might result in criminal consequences and a review of airline licences.
ATTEMPT TO SMUGGLE 5.2 MILLION CAPTAGON PILLS INTO SAUDI ARABIA THWARTED
On 22 October, Zawya reported that Saudi Arabia Customs has prevented an attempt to smuggle the Captagon amphetamine pills into the country, “crushed” and hidden in a consignment of “carbonate powder” bags.
MALTA-BASED BANK FINED OVER €300,000 FOR MONEY LAUNDERING PRACTICES
On 23 October, Lovin Malta reported that NBG Bank has been fined €337,422 for money laundering regulations breaches by the FIAU – including weak oversight of a “very well-known” businessman’s multi-million US dollar transactions. NBG bank was formerly known as Finansbank Malta and has been in Malta since 2005, mainly working with high net-worth clients and corporations.
OVERSEAS SATELLITE COLLEGES RAKE IN MILLIONS TAX-FREE FOR UK PRIVATE SCHOOLS
On 18 October, The Times reported that private schools are exploiting their charitable status to claim back millions in tax on income from satellite campuses in Abu Dhabi, China, Egypt and Kazakhstan. Dulwich, Harrow, Marlborough and Repton are said to be among 20 exclusive schools that used the legal loophole to recoup an estimated £13 million in tax.
EXPERTS WARN OF INCREASING CYBER SECURITY THREATS FOR THE AFRICAN MARITIME INDUSTRY
On 22 October, Defence Web reported that the number of cyber attacks around the world continues to grow and this includes those targeted at the maritime sector. It cites an attack on Transnet, a major South African rail, port and pipeline company, which handles 60% of the country’s container traffic in its Durban port. It was hit with a ransomware attack which caused massive disruptions and container terminals had to switch to manual processing of cargo until IT systems were restored. It says that ports are attractive targets that are vulnerable to cyber attacks. It reports on a webinar from the Institute for Security Studies (ISS) held in September which centred around maritime cyber security in Africa.
On 21 October, the Institute of Chartered Accountants in England and Wales said that, developed in conjunction with the Home Office, the charter has 4 main actions to be delivered in collaboration between the accountancy profession, government and law enforcement agencies. It is said that it is important for ICAEW to work with the government to improve understanding of the fraud threat across the sector and help strengthen trust in the profession.
WHY ARE US AUTHORITIES TRYING TO CURB THE RISE OF DELTA8 THC?
Are 22 October, Jurist reported that a decision by Texan authorities to make theirs the latest state to ban Delta-8 THC has highlighted the growing tension surrounding this federally legal, but increasingly scrutinized marijuana-derived compound. A little-known hemp by-product, Delta-8 has proliferated in recent years. The article considers Delta-8 and its precarious legal status in the US.
IRELAND: GENERAL SCHEME OF THE GAMBLING REGULATION BILL
On 21 October, Irish law firm McCann Fitzgerald published a report saying that the Bill takes into consideration a number of expert reports including the Interdepartmental Working Group On Future of Licensing and Regulation of Gambling 2019. It would introduce a new independent Gambling Regulatory Authority of Ireland, changes to licensing and enforcement etc.
OFAC VIOLATIONS FROM SALES THROUGH DISTRIBUTORS AND SALES AGENTS
On 13 October, Williams Mullen published an article saying that one of the most common methods of exporting is sales through overseas distributors, sales representatives and marketing agents. However, this also is one of the greatest areas of export compliance risk – if your distributor sells to a prohibited country or prohibited party, your company can have liability in many instances. Reflecting on a recent US case, it says that sales through third party intermediaries can be a valuable strategy for international sales – but a sale to a third-party intermediary, by itself, does not get you off the hook if your product winds up in the hands of a bad guy or in a bad country.
PANDORA LEAKS SHOW KLEPTOCRACY IS FLOURISHING IN THE UK
A commentary from Chatham House on 21 October pointed out that, in response to the recent revelations of the Pandora Papers, the UK Chancellor of the Exchequer claimed the UK is one of the best in the world at tackling money laundering – a debatable claim given, while the UK laws are robust, enforcement of them is often lacking. However, it says that this misses the main issue anyway, because the majority of the Pandora stories are not about money laundering – the transference of illicit funds – but the proceeds of grand corruption or ‘kleptocracy’.
NEW DATA TOOL EXPLORING CRIMES COMMITTED BY US QANON OFFENDERS
On 24 September, National Consortium for the Study of Terrorism and Responses to Terrorism (START) published a new data tool, which users can interact with to explore criminal offenses committed in the United States that were motivated by the QAnon and PizzaGate conspiracy theories, going back to 2016.
NEW ZEALAND: POLICE DISMANTLE SOPHISTICATED DRUG DEALING AND MONEY LAUNDERING OPERATION
On 22 October, the New Zealand Herald reported that assets totalling around $3.5 million have been seized by police in a series of raids executed on a New Zealand drug and money laundering network. The restrained assets include 6 properties, a catamaran, a yacht, a leisure boat, a jet ski, a motorbike and classic cars. It involved a 10-month-long investigation into the sale and supply of methamphetamine and associated offending.
BOSS OF FAILED BOSTON IndyCar RACE PLEADS GUILTY TO FRAUD, MONEY LAUNDERING
On 22 October, Autosport reported that a former CFO of the Boston Grand Prix organisation which was trying to bring an IndyCar race to the city was indicted in September 2020 for channelling funds for his own personal gain and laundering the proceeds of the scheme, which he failed to report as income. John Casey pleaded guilty to “23 counts of wire fraud, 3 counts of aggravated identity theft, 4 counts of money laundering and 3 counts of filing false tax returns”.
AUSTRALIAN ART DEALER ADMITS TO MULTIMILLION-DOLLAR FRAUDS OVER BACON AND BASQUIAT PAINTINGS
On 23 October, WA Today reported that a globe-trotting Australian art dealer has admitted to frauds involving multimillion-dollar artworks in a case in the Channel Islands. Andy Valmorbida, 42, was described as “serially dishonest” in a judgment last month in a civil case in Jersey. He is a member of the Valmorbida family who made hundreds of millions of dollars importing Italian goods into Australia in the 1950s. Valmorbida was being sued by tycoon and former hedge fund manager Christian Hore over unpaid debts and had admitted during cross-examination to a series of frauds involving multimillion-dollar artworks.
IRISH SIBLINGS FOUND GUILTY OF FRAUD FACE UP TO 20 YEARS IN US JAIL
On 23 October, the Irish Examiner reported that 3 executives of a large US construction company, Navillus Contracting, which was founded by a Kerry family face up to 20 years in jail after being found guilty of fraud. Donal O’Sullivan, 60, and his sister Helen O’Sullivan, 61, together with Padraig Naughton, 49, faced charges in New York. They are said to have devised a fraudulent scheme to avoid making required contributions to union benefits funds on behalf of Navillus’ workers, in order to deprive the workers of benefits they had earned and deserved.
PROSECUTORS IN DETROIT UNCOVER MASSIVE MONEY LAUNDERING OPERATION BETWEEN US AND DUBAI
On 23 October, the Miami Herald reported that federal prosecutors in Detroit have seized about $12 million in cash they allege was part of a massive money-laundering operation, called “The Shadow Exchange,” operating between the US and UAE. Shell companies involved in the scheme, mostly located in Dubai, used fake invoices and other methods to disguise the origins of money, sent to banks — including major US banks. It is said to have provided services to persons seeking to transfer US dollars in a manner calculated to avoid anti-money laundering measures of the financial system and the scrutiny of international law enforcement.
SHADOW INFLATION: SHIPPING COSTS ARE UP WAY MORE THAN YOU THINK
On 22 October, American Shipper published an article saying that costs are not just about freight rates. As service quality plummets, effective inflation goes even higher. As rates have skyrocketed, delivery reliability has collapsed amid historic port congestion. Ocean cargo shippers are paying more than they ever have before for the worst service they’ve ever experienced. A consultancy recently predicted that global container rates will increase by an average 126% this year versus 2020, including both spot and contract rates across all trade lanes. Service metrics have sunk as rates have risen.
On 15 October, Mongabay reported that new report released by the Wildlife Justice Commission identifies the giant clamshell trade as a “cause for concern”. China and Japan are noted as potential markets of concern in the giant clamshell trade. However, little is known about the giant clamshell trade, which has prompted experts to call for more investigations into the issue. In the last 50 years, there has been a considerable increase in the illegal poaching of clams for luxury food, the aquarium trade, and the ornamental carving industry
On 22 October, FATF published a report saying that it had initiated an industry survey in consultation with the Basel Committee on Banking Supervision (BCBS) to identify areas where divergent AML/CFT rules or their implementation cause friction for cross-border payments. The survey results highlight, among others, that lack of risk-based approach and inconsistent implementation of the AML/CFT requirements increases cost, reduces speed, limits access and reduces transparency. Inconsistent national approaches also create obstacles in identifying and verifying customer and beneficial owners, effective screening for targeted financial sanctions, sharing of customer and transaction information where needed, and establishing and maintaining correspondent banking relationships
Panama Covid-19 update – it was reported yesterday that Panamanians who have completed the complete vaccinationscheme against Covid-19 (i.e. 2 doses) will be granted the digital vaccination certificate of the EU.
Meanwhile, today saw a small rise of 8 in the number of active cases – 2,324; despite the numbers of those in hospital and hospital-hotels (presumably the more seriously affected) all falling. There were 193 new cases and 3 new fatalities reported, with 33 patients in ICU and 156 in other wards.
22 OCTOBER 2021
US: LARGEST-EVER PAYMENT MADE BY CFTC TO WHISTLEBLOWER
On 21 October, the Wall Street Journal reported that the Commodity Futures Trading Commission had made a $200 million award to a whitleblower whose information helped US and UK regulators investigate manipulation of global interest-rate benchmarks by Deutsche Bank AG.
US ISSUED IN EXPORT LICENCES WORTH $100 BILLION TO SUPPLIERS OF HUAWEI AND SMIC
On 21 October, the Wall Street Journal reported that the Commerce Department issued more than $100 billion worth of export licences for semiconductors and other products to suppliers of Huawei Technologies and another blacklisted Chinese tech company, as a global chip shortage started to bite.
THE NEW ICC TRADE FINANCE DIGITAL TRANSACTION RULES
On 20 October, an article from CETINKAYA in Turkey said that the International Chamber of Commerce (ICC) has published the Uniform Rules for Digital Trade Transactions (URDTT), which constitute the international laws of trade financing practice, and came into force on 1 October. Work on the URDTT began in December 2018 following the realisation that there was a lack of rules for digital transactions. URDTT is a comprehensive set of rules designed to cover all parties of digital commerce transactions. Its core mandate is to pave the way for commercial transactions in compliance with the UNCITRAL Model Law.
US: REPORT TO CONGRESS ON EMERGING MILITARY TECHNOLOGIES
On 22 October, USNI News made available a report to the US Congress from the Congressional Research Service which provides an overview of selected emerging military technologies in the US, China, and Russia – including AI-based, biotechnology, directed-energy (laser) weaponry and hypersonic.
US: NEW RULES GOVERNING EXPORT OF HACKING AND CYBERDEFENCE TOOLS
On 21 October, ZD Net reported on the new US export controls from the Commerce Department designed to stop companies from selling hacking tools to China, Russia and other countries that may use them for nefarious purposes. Companies would be barred from selling some technology to certain countries without a specific licence.
AUSTRALIA DEFENCE EXPORT CONTROLS – RED FLAGS FOR DEFENCE INDUSTRY
On 22 October, Australia Defence Magazine published an article listing a number of Red Flag checks which it is said will reduce the likelihood of an inadvertent breach of export controls. It is said that these simple checks are easily applied and should be completed as part of an initial licence or agreement screening programme.
ARTWORKS SEIZED OR IMPOUNDED BY CUSTOMS AUTHORITIES
On 20 October, as part of an article on the detention of an “artist robot” and its artwork from Egypt, the Guardian detailed other instances of artworks seized or detained by various countries’ authorities in recent years.
2 SOUTH KOREAN COMPANIES TO SUPPLY ENGINES FOR TURKEY’S ALTAY TANK
On 22 October, Defense World reported that the 2 companies had signed contracts to supply engine and transmission mechanisms for the Altay battle tank. The programme had suffered a setback due to Turkey’s political differences with Germany, where the engines were originally sourced, due to an arms embargo on Turkey, imposed for its involvement in the Syrian Civil War.
AUSTRALIAN LOBSTER SMUGGLING TO HONG KONG LABELLED A ‘NATIONAL SECURITY RISK’
On 22 October, the Sydney Morning Herald and others reported that Australia’s $80-million-a-month access into the Chinese lobster market may shut after the lobsters were identified as a national security risk by Hong Kong’s new customs chief. Australia’s monthly exports to Hong Kong have boomed by 2000% since China banned the lobsters from the mainland in October 2020. Rampant smuggling of Australian rock lobsters into mainland China has now been described as a national security threat, and the new head of customs has vowed to crack down on the trade.
BULGARIA SEIZES OVER 40 KG OF SMUGGLED GOLD ITEMS AT BORDER
On 22 October, the Big News Network reported that Bulgarian customs inspectors have seized 41.6 kg of smuggled gold jewellery at Danube Bridge checkpoint near Vidin at the border with Romania, the largest shipment in 17 years. It was found in a car with German registration, driven by Bulgarians, and which was traveling from Bulgaria to Germany.
MONEYVAL COMMENCES EVALUATION PROCESS OF NORTH MACEDONIA AND ROMANIA
On 19 October, the Council of Europe reported that MONEYVAL has commenced its 5th round mutual evaluation process of North Macedonia and Romania with a high-level exchange. Training was provided by the MONEYVAL Secretariat, which takes place approximately 1 year in advance of the onsite visit.
PROSECUTORS IN DETROIT UNCOVER MASSIVE MONEY LAUNDERING OPERATION BETWEEN US AND DUBAI
On 22 October, the Detroit Free Press reported that federal prosecutors in Detroit have seized about $12 million in cash they allege was part of a massive money laundering operation, called “The Shadow Exchange,” operating between the US and UAE. It is also alleged that some of the laundered money was used to buy armoured vehicles for an illegal drug trafficking operation based in Michigan. The shell companies involved in the scheme, mostly located in Dubai in UAE, used fake invoices and other methods to disguise the origins of money.
UK: ICAEW BACKS THE ACCOUNTANCY SECTOR FRAUD CHARTER
On 22 October, Accountancy Magazine reported that the charter which is supported by the accountancy profession, government and law enforcement agencies sets out a set of actions to close in on potential vulnerabilities that fraudsters may exploit.
UK: NEW CAMPAIGN APPEALS TO LORRY DRIVERS IN CRACKDOWN ON PEOPLE SMUGGLING
On 22 October, an NCA news release said that lorry drivers across Britain are being urged to lock their vehicles and report any suspicious activity that could be linked to people smuggling, in a joint appeal being led by the NCA and Border Force. The campaign will target freight drivers across England, Scotland and Wales with messaging at service stations and ports.
AGREEMENT REACHED AT OECD TO END EXPORT CREDIT SUPPORT FOR UNABATED COAL-FIRED POWER PLANTS
On 22 October, a news release from the OECD advised that the ban will come into effect once Participants complete their formal internal decision-making processes, which are expected by the end of October 2021. The Participants to the Arrangement are Australia, Canada, EU, Japan, Korea, New Zealand, Norway, Switzerland, Turkey, UK, and US.
LUXEMBOURG FIRST IN EUROPE TO LEGALISE GROWING AND USING CANNABIS
On 22 October, the Guardian reported that adults will be permitted to grow up to 4 cannabis plants in their homes or gardens under laws that will make it the first country in Europe to legalise production and consumption of the drug. Luxembourg will join Canada, Uruguay and 11 US states in flouting a UN convention on the control of narcotic drugs, which commits signatories to limit “exclusively for medical and scientific purposes the production, manufacture, export, import distribution, trade, employment and possession of drugs” including cannabis.
INDICTMENT OF SAAB PARTNERS DETAILS VAST VENEZUELA AID KICKBACK SCHEME
On 22 October, Insight Crime reported that 5 business partners of Álex Saab – an accused money launderer and ally of Venezuela President Nicolás Maduro – have been indicted by US prosecutors on charges of being part of a multi-million dollar graft scheme in which Venezuelan officials got kickbacks for overpriced food and medicine contracts.
PRIVY COUNCIL CLARIFIES JURISDICTION OF FREEZING ORDERS IN KEY BVI CASE
On 22 October, an article from out-Law advised that the Privy Council has ruled that courts have the power to grant a freezing injunction against a party to help the enforcement of a prospective or existing foreign judgment. However, it is said that the introduction of the Eastern Caribbean Supreme Court (Virgin Islands) (Amendment) Act 2020 had limited the impact of the Privy Council’s judgment on BVI law, but that nevertheless it will avoid the BVI being used as a jurisdiction by parties who want to avoid the enforcement of foreign judgments
MOZAMBIQUE’S TUNA BONDS SCANDAL: YES, IT’S ABOUT MONEY, BUT MORE THAN THAT – IT’S ABOUT HUMAN LIVES
On 21 October, an article from the Basel Institute on Governance reminds one that 20 people are facing corruption and money laundering charges in the country. Swiss bank Credit Suisse has agreed to pay $475 million in fines and write off $200 million in debt owed by Mozambique as part of a series of settlements with regulators in the US, UK and Switzerland for its role in the affair.
On 20 October, Coindesk said that the US Government still doesn’t really know how to regulate the $2.5 trillion crypto market. It’s not that the laws don’t exist, or that Congress is uninterested in digital assets – it’s more that there’s a lack of consensus on how to apply existing regulations to an industry that seems to mutate every few weeks.
US: FORMER FEDEX GROUND SENIOR MANAGER SENTENCED IN $3.25 MILLION STOLEN-GOODS SCHEME
On 22 October, Freightwaves reported that a former senior manager of a FedEx Ground facility in Delaware has been sentenced to more than 3 years in prison and ordered to pay back more than $1.1 million and forfeit over $1.8 million in property for his involvement in a decadelong stolen-goods scheme 2009-19.
IAEA GUIDANCE ON COMPUTER SECURITY FOR NUCLEAR SECURITY
On 21 October, the International Atomic Energy Authority advised that it had issued guidance to support experts worldwide in implementing computer security measures to strengthen their national nuclear security regimes.
US OFFERS REWARD FOR ANOTHER ASSOCIATE OF VENEZUELA’S PRESIDENT MADURO
On 22 October, IBT Times reported that the US has offered a $10 million reward for the arrest on money laundering charges of Alvaro Pulido, who is Colombian and an associate of businessman Alex Saab, whose extradition infuriated Nicolas Maduro. He has been indicted alongside Alex Saab on allegations they ran a network that exploited food aid destined for impoverished Venezuelans and moved $350 million into foreign accounts.
EL PASO MAN ACCUSED OF $3.9 MILLION FRAUD INVOLVING STOCKS, CRYPTOCURRENCIES INVESTMENTS
On 22 October, the El Paso Times reported that he is accused of stealing more than $3.9 million in a Ponzi-like scheme that involved fraudulently promising clients his company would invest their money in stocks and cryptocurrencies. The Commodity Futures Trading Commission officials filed a civil compliant against Abner Alejandro Tinoco and his investment company, Kikit & Mess Investments LLC.
AMERICANS TRICKED OUT OF MORE THAN $586 MILLION IN COVID-RELATED SCAMS
On 20 October, The News Tribune reported that scammers have bilked American consumers out of more than $586 million through fraud schemes inspired by the global COVID-19 pandemic between October 2020 and October 2021. Americans filed more than 269,000 fraud complaints related to coronavirus.
CYPRUS-BASED COMPANY AND SOUTH AFRICAN LAW FIRM HAVE AGREED TO GIVE UP NEARLY £29 MILLION THAT WAS ALLEGEDLY LINKED TO MONEY LAUNDERING
On 22 October, AOL reported that City of London Police said they had reached an agreement with the 2 companies that would see them give up the €34 million from 2 bank accounts. The report said that there were no responses from representatives of Xiperias and Du Toit & Co.
UK LAW COMMISSION’S RECENT PROPOSALS FOR THE REFORM OF ENGLISH LAW REGARDING POSSESSION OF ELECTRONIC TRADE DOCUMENTS
On 22 October, an article from Hellenic Shipping News explained proposals and the accompanying draft legislation from the Law Commission which suggest that more universal digitisation of electronic bills of lading and other trade documents will soon be a reality. It says that the proposals herald a far-sighted and welcome modernisation of English law to reflect the new digital world; and what will be important going forward is that the global marketplace perceives that enough of the technological challenges around electronic trade documents have been overcome to facilitate widespread uptake. If that can be achieved, then English law will be ready to help realise the full potential of digital trade documents.
DRUG BUST ON BOARD THAI BULK CARRIER IN NIGERIA RAISES EYEBROWS
On 21 October, Insurance Marine News reported that the Thai bulk carrier Chayanee Naree, which had been in Nigerian waters south of Lagos since arrival from Santos, Brazil, on 1 October was seized on 9 October. The Nigerian authorities said that agencies were alerted by Nigerian Interpol, and an intelligence report received from the UK Border Force. It is said that that a bag was found with 30 packages of cocaine inside weighing 32.9kg and that the crew of 22 Thai nationals were arrested. The article poses questions about the events, including the time taken to search the ship and uncover the drugs.