Breaking news is that former President Ricardo Martinelli has been acquitted, for the second time (the earlier trial ended in August 2019), of th interception of communications and monitoring, persecution and surveillance without judicial authorisation.
In other news, yet another public holday today, marking a day in 1821 on which an uprising was said to have galvanised support and inspired enough momentum to bring independence to Panama and the Independence Act of Panama was officially declared on 28 November 1821. Panama then joined Venezuela, New Granada (present-day Colombia) in the Republic of Colombia (aka Gran Colombia).
Panama Covid-19 update – the media reports that one regional hospital now has no hospitalised Covid patients for the first time since the pandemic began. Meanwhile, 185 new cases have been record, but no fatalities; with 1,642 active cases – 27 in ICU and 117 in other wards.
10 NOVEMBER 2021
AN INTRODUCTION TO ISLAMIC FINANCE AND ITS IMPACT ON TRADE
A guest post from the ICC Academy says that Islamic finance is an evolving branch within the finance industry which derives its roots from Islamic jurisprudence. It provides the history of modern Islamic finance, the different modes or instruments used in Islamic finance as well as how it fits in with international trade. At the end of the guide it provides a glossary of key terms.
CHINESE TEXTILE COMPANY LOSES CASE FOR REMOVAL FROM US ENTITY LIST
On 10 November, EU Sanctions blog reported that the Changji Esquel Textile Co Ltd, a subsidiary of Hong Kong-based textile company Esquel Group, was added to the Entity List on 22 July 2020 for its alleged involvement in a human rights violations and abuses committed by China. Its application for an injunction to remove it from the Entity List has been dismissed.
IDENTIFYING AND MANAGING SANCTIONS RISK IN THE AVIATION SECTOR
In the latest edition of its Aero newsletter, law firm HFW says that the aviation sector has been identified by US sanctions authorities as a high-risk industry, and last year OFAC took significant enforcement action against 2 companies operating in the sector. Looking at the cases, it says that a common factor in each case was the need (highlighted by OFAC) for companies operating in the aviation industry to implement effective, thorough and on-going risk-based compliance measures. These measures include considering contracts with customers and suppliers, as well as analysing the covenants and others terms in their arrangements with banks and insurers.
SINGAPORE: MAS PROPOSES AML/CFT/CFP INFORMATION-SHARING PLATFORM
On 9 November, Baker McKenzie published an article saying that the Monetary Authority of Singapore (MAS) had released for consultation a proposal which will require Financial Institutions to share with each other information on customers or transactions, where they cross material risk thresholds, on a secured digital platform owned and operated by MAS to be named COSMIC.
ISRAEL AND INDIA SIGNS PACT TO ADOPT DUAL-USE TECHNOLOGIES BY SMALL BUSINESSES
On 9 November, Daily Research and others reported that the 2 countries have agreed to stimulate innovation and accelerate the development of dual-use technologies by SME businesses in both countries. Parties to the agreement were the Defense Research and Development Organization of India (DRDO) and the Israel Defense Research and Development Directorate (DDR & D). mentioned are drones, robotics, artificial intelligence, quantum technology, photonics, biosensors, brain-machine interface, energy storage. portable devices. devices and natural language processing.
THAILAND: WARNING AGAINST SMUGGLED JOHNSON & JOHNSON COVID VACCINES
On 10 November, Thaiger reported that the Food and Drug Administration is warning people to avoid offers of Johnson & Johnson vaccines that were illegally smuggled into Thailand after a patient apparently brought in a vaccine to a private clinic and paid to have medical staff administer it. The FDA warned against smuggled vaccines that may not have been handled safely. Reports say the vaccine is suspected of being smuggled from Cambodia.
SENATE HEARING HEARS AUSTRALIA IS LAGGING BEHIND IN UPDATING ITS MONEY LAUNDERING AND TERRORIST FINANCING LAWS
On 10 November, The Courier reports that Australia is at risk of becoming destination priority one for laundering money if the nation’s financial crime laws are not brought into line with the rest of the world. During the hearings, the Police Federation of Australia chief executive said the real estate sector has become lucrative way to legitimise tainted cash. The article says that Australia currently is not compliant with global standards set by FATF. The hearings continue.
MINING OPERATION OWES MILLIONS OF TAXES TO SOLOMON ISLANDS
On 10 November, Mining technology reported that a mining operation has been accused of owing millions in unpaid taxes and royalties to the Solomon Islands, having not paid taxes or royalties on over one-third of their exports over the past 5 years.
WINE FUGITIVE FROM UK FREED FROM JAIL IN ITALY
On 10 November, The Drinks Business reported that Livio Mazzarello, 61, who went on the run to escape a UK conviction for tax fraud has walked free after serving 4 years behind bars in Italy. He skipped bail during his Old Bailey trial in 2017 and fled the UK before he could be sentenced to 14 years imprisonment for fraudulent evasion of VAT. An Italian court reduced his sentence to 8 years, and he was released from prison in Genoa in June 2021 after serving less than 4 years behind bars.
CALIFORNIA SCAMMER GETS 30 YEARS IN JAIL FOR $1 BILLION PONZI SCHEME
On 10 November, Business Times reported that Jeff Carpoff, the co-owner of a solar energy company, DC Solar, has been sentenced to 30 years in jail for orchestrating an elaborate Ponzi scheme that duped investors of $1 billion.
A news release from State Security of Ukraine (SSU) on 9 November advised that the SSU had exposed illegal activity of officials of Odesa branch of a state enterprise that falls within the remit of the Ministry of Infrastructure of Ukraine. Construction and technical examination indicated that the offence led to state losses of over $380,000.
WHY IS BOSNIA ON THE BRINK AGAIN?
On 10 November, a Commentary from RUSI posed this question, saying that Bosnia and Herzegovina is once again making headlines. There is talk of renewed violence, with the blessing of Serbia and Russia. But the entire region is in a precarious situation.
EUROPE’S PROSECUTOR IN ACTION AGAINST VAT CAROUSEL FRAUD
On 9 November, OCCRP published an article saying that authorities in Germany had arrested 4 people suspected of forming a criminal organisation and evading taxes, which is believed to have resulted in €23 million in tax loss in Germany. This is said to be an example of how organised criminals use VAT schemes to syphon an amount equivalent to the GDP of Greece from the EU budget. By far the most damaging and sophisticated of these scams is ‘carousel fraud,’ which drains an estimated €50 billion per annum from the EU’s coffers.
UK: THE ADMINISTRATOR OF THE SILK ROAD DARK WEB BLACK MARKET HAS BEEN ORDERED TO TURN OVER MORE THAN $660,000 WORTH OF BITCOIN
On 9 November, OCCRP reported that the NCA believes that Thomas White, who they describe as “an unemployed dropout,” acquired the money illegitimately while he was administering the site that offered everything from drugs to fake identities for a price.
GUATEMALAN COURT CLEARS EXTRADITION OF SONS OF FORMER PANAMA PRESIDENT RICARDO MARTINELLI TO THE US
On 10 November, Kenneth Rijock in his blog reported that a court has approved the immediate extradition of the 2 adult sons of former Panamanian President Ricardo Martinelli to the US, where they face federal criminal charges in connection with millions of dollars in bribes and kickbacks allegedly paid through them, by the Brazilian construction giant Odebrecht, for their father.
ITALY: 70 MEMBERS OF THE ‘NDRANGHETA MAFIA GROUP SENTENCED ON CHARGES RELATING TO ATTEMPTED MURDER AND EXTORTION
On 9 November, Jurist reported that the current trial focused specifically on the Mancuso family and defendants in the case ranged from businessmen to politicians.
PETROFAC: PLEA BARGAIN VERSUS DPA AND THE IMPORTANCE OF GOOD COMPLIANCE
On 19 October, 5 St Andrew’s Hill chambers published a briefing about the Petrofac case, in which the company was convicted for failure to prevent bribery. It says that while Petrofac had attempted their own internal investigation in 2016, the allegations failed to come to light, at least in that there was no self-report to the SFO, and Petrofac’s culpability sprang from the failure of its internal compliance policies. It explains why factors specific to this case made it unlikely the SFO and Petrofac could reach a DPA. It also highlights lessons it says has been learned from a compliance perspective. It concludes that the Petrofac case stands as a stark reminder to corporations, especially those operating internationally to have robust procedures in place to prevent bribery and corruption and the necessary safeguards to handle any allegations of wrongdoing when or if they arise.
WHAT DOES MASSIVE FENTANYL SEIZURE IN MEXICO SAY ABOUT US-MEXICO SECURITY RELATIONS?
An article from insight Crime on 9 November asked this question after a recent seizure of fentanyl in Mexico has shed further light on the capacity of organised crime groups to mass-produce the deadly synthetic opioid. Illegal fentanyl seizures in Mexico have risen sharply in recent years, particularly along the US-Mexico border. It says that the latest fentanyl seizure is emblematic of the ability of Mexico’s organised crime groups to adapt and ramp up production as the synthetic drug becomes one of the main staples of their drug trafficking portfolio.
LEBANON: LIMITING THE FALLOUT FROM US SANCTIONS ON SYRIA
A Commentary from War on the Rocks on 20 November says that Lebanon has recently been beset with near-total electrical blackouts. Now the Biden Administration has endorsed a World Bank project that would power Lebanon using Egyptian natural gas and Jordanian electricity. The problem, for critics, is that this energy would be delivered via Syria, and opponents of the energy deal believe it would contravene US sanctions on Syria. It says that a close reading of existing sanctions regulations, however, appears to confirm that the project is permissible.
PODCAST: CATCHING UP WITH CHIEF OF THE FCPA UNIT AT US DoJ
In the latest TRACE podcast, Dan Kahn joins the podcast to discuss his time at the DoJ, including as Chief of the FCPA Unit, and his recent transition back to private practice as a partner in the White Collar Defense and Investigations practice in Davis Polk’s Washington office. Dan discusses recent trends, the new guidance announced by Deputy Attorney General Lisa Monaco and some approaches to pursuing demand-side bribery.
UK BREXIT: NEW REQUIREMENTS FOR IMPORTING ANIMAL AND PLANT GOODS FROM 1 JANUARY
Companies House on 10 November reminded businesses that, from 1 January, pre-notification will be required for imports to Great Britain of most products of animal origin, animal by-products, high risk food not of animal origin and regulated plants and plant products from the EU. This is the latest phase in the (much delayed) implementation by the UK of post-Brexit customs controls.
US: PENALTY AND AUDIT REQUIREMENT FOR COMPANY’S UNLICENSED SHIPMENTS TO HUAWEI AND RELATED ENTITIES
A news release from the US Commerce Department’s Bureau of Industry and Security on 8 November advised that a penalty of $80,000 on SP Industries Inc (aka SP Scientific), of Warminster, Pennsylvania. Audit requirements related to allegations were also imposed. SP Industries is said to have committed 4 violations of the Export Administration Regulations by exporting items to Huawei Technologies Co Ltd and 2 subsidiaries without the required BIS licences.
IRISH REVENUE WARNS ONLINE SHOPPERS OF POTENTIAL ADDITIONAL COSTS WHEN BUYING GOODS ONLINE FROM OUTSIDE THE EU (INCLUDING THE UK!)
On 10 November, the Revenue Commissioners issued a news release advising consumers to check whether the advertised price of goods includes all tax and duty costs due before making a decision to buy. Where the price advertised is not inclusive of these costs, then additional charges including VAT and Customs Duty can apply once the goods arrive in Ireland. It warns that such charges may also apply to goods from the UK and, in any event, a rule change in July meant import VAT was due on imported goods regardless of their value.
MYANMAR JUNTA COURT SENTENCES FORMER OPPOSITION CHIEF MINISTER TO 75 YEARS FOR ‘CORRUPTION’
On 9 November, RFA reported that a military court in Myanmar has sentenced the former National League for Democracy (NLD) chief minister of Kayin state, Nang Khin Htwe Myint, 67, to 75 years in prison for “corruption”.
DESPITE SANCTIONS, IRAN’S DRY NATURAL GAS PRODUCTION GREW STEADILY OVER THE PAST 20 YEARS
On 10 November, an article in Hellenic Shipping News from the US Energy Information Administration says that, despite international sanctions, Iran produced 8.4 trillion cubic feet (Tcf) of dry natural gas in 2019, making the country the world’s third-largest dry natural gas producer after the US and Russia. Natural gas production in Iran has grown steadily over the past 2 decades despite sanctions.
39% OF SUB-SAHARAN AFRICA FIRMS LACK ANTI-BRIBERY CONTROLS
On 8 November, Zawya reported the results of a survey which says that some organisations in Sub-Saharan Africa (SSA) continue to lack anti-bribery controls and cybercrime programmes, while only a small number view ESG as a significant concern. Refinitiv’s survey highlighted new trends this year, including low awareness of third-party exposure, high demand for advanced compliance technology, emerging supply chain risks and lack of digital identity solutions in KYC protocols.
THAILAND: HUGE DRUG SEIZURES AND ARRESTS HAVING NO EFFECT ON DRUG TRADE
On 9 November, the Bangkok Post reported that authorities arrested about 330,000 suspects, smashed 4,925 drug networks and seized large amounts of drug-related assets in the fiscal year just ended. However, the Deputy Prime Minister has said that, despite the arrests and huge seizures, the drug problem continued unabated.
UK: MP GEOFFREY COX ACCUSED OF CONFLICT OF INTEREST OVER CAYMAN ISLANDS WORK
On 10 November, the Guardian reported that the former UK Attorney General is facing a conflict of interest claim after it emerged that he had lobbied against imposing tougher financial regulation on the Cayman Islands just months after he gained more than £40,000 from legal firms based in the tax haven.
OPERATION MOBILE 4 SEES 23 COUNTRIES CLAMP DOWN ON SMUGGLING AND TRAFFICKING
A news release from Europol on 10 November advised of an operation involving joint action of 23 European countries alongside Frontex, Interpol and Europol. A 2-week operation targeting multiple forms of organised property crime and fraud, has successfully concluded its November action days after thousands of border and roadside checks across Europe. Police Officers and Border Guards from 23 European and West Balkan states were involved in the investigation.
MOZAMBIQUE’S ILLICIT GEMSTONE TRADE: A DOWNWARD SPIRAL OF CORRUPTION
On 10 November, OCCRP carried an article about a new report which says that the opaque nature of Mozambique’s illicit artisanal and small-scale mining industry has siphoned millions from the country’s economy, trapped its workers in a perpetual state of poverty, and has become a significant source of government and police corruption. Rubies are the most sought after gemstone (of the several types present), with large deposits unearthed in northern Mozambique.
The report is at –
SOUTH AFRICA: HIGH COURT ORDERS MOZAMBIQUE’S EX-FINANCE MINISTER MANUEL CHANG TO STAND TRIAL IN US
On 10 November, Daily Maverick reported that Johannesburg High Court has ordered that former Mozambican finance minister Manuel Chang must be extradited to the US to face charges of corruption. This decision overturned the 23 August decision to instead extradite Chang to his home country to face a range of charges related to a $2-billion “hidden debts” scandal.
US: PARTNER AT WORLD’S LARGEST CONSULTING COMPANY CHARGED WITH INSIDER TRADING
On 10 November, the daily Caller reported that Puneet Dikshit, a partner at McKinsey, had been arrested after being charged with insider trading on a Goldman Sachs deal with finance and technology lender GreenSky.
SPAIN TO EXTRADITE CHÁVEZ’S EX-SECURITY CHIEF TO US
On 10 November, ABC News and others reported that the National Court has decided to extradite the former security chief of late Venezuelan president Hugo Chávez to the US to face charges of money laundering and belonging to a criminal organisation. Adrián Velásquez allegedly received the bribes together with his wife Claudia Díaz, Venezuela’s former treasurer, from businessman Raúl Gorrín (who remains in Venezuela).
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