On 25 November, ENACT Africa produced a report which provides insight and analysis to enable law enforcement agencies in North and West Africa to devise appropriate responses to the threat. Trafficking in human beings for organ removal (THBOR) is driven largely by the global shortage in organs for ethical transplant.
On 25 November, a proposal of the OECD Working Group on Bribery in International Business Transactions had been accepted and a Recommendation dating from 2009 had been amended. The Recommendation on combating bribery of foreign public officials in international business transactions is replaced. The new version seeks to update and expand upon the 2009 Anti-Bribery Recommendation with a view to further supporting the full implementation of the Anti-Bribery Convention by reflecting recent trends and challenges in the foreign bribery field, to ensure that it remains relevant and effective. New sections have been included on key topics that have emerged or significantly evolved in the anti-corruption area since 2009, in particular:
Addressing the Demand Side of Foreign Bribery Cases;
Sanctions and Confiscation;
Protection of Reporting Persons;
Incentives for Compliance; and
The draft revised Recommendation also updates or broadens the scope of provisions on pre-existing topics, including enforcement as well as awareness raising, training and guidance.
A report from Conflict Armament Research contains a case study which looks at 6 different Russian-manufactured military unmanned aerial vehicles (UAV – commonly called ‘drones’) that CAR documented in Ukraine. CAR’s investigations found that the Russian military industry has been obtaining key components for these UAV – such as GPS modules, electronic parts, cameras, and engines – from the US, Asia, the Middle East, and EU, both before and after the start of the conflict in Ukraine in 2014, and despite an EU arms embargo on Russia.
Athina 984 reported on 27 November that former Argentine President and current Vice-President Cristina Fernandes de Kirsner, as well as her 2 children, Florence and Maximo, have been acquitted of charges of corruption and money laundering involving the family real estate business.
On 26 November, the Washington Post reported that an arbitration panel has ruled in favour of 2 Iranian banks in a financial dispute over the 2015 closing of a Bahraini financial institution accused of helping Iran skirt US and UN economic sanctions. A Hague-based tribunal ordered the government of Bahrain to pay more than $270 million in compensation for losses and legal fees stemming from its decision to close Future Bank. Future Bank was established in Bahrain in 2004 with the backing of Bank Melli and Bank Saderat, 2 of Iran’s largest financial institutions.
Panama Covid-19 update – so far, Panama has not announced the same travel restrictions that have been introduced by the UK and EU. But then there are no direct, and few (I would have thought) indirect links – though there are South Africans living in the country.
Meanwhile, no new fatalities today and the number of active cases increased by only 1, to 2,664. However, there were 223 new cases reported, with increases in numbers in hospital – 25 in ICU and 105 in other wards.
26 NOVEMBER 2021
REMITTANCES HAVE CUSHIONED THE IMPACT OF COVID-19 IN POOR COUNTRIES
On 25 November, The Economist reported that, even though migration slowed in the past year, payments home surged.
US MANUFACTURERS RACE TO RELIEVE A PANDEMIC-TRIGGERED AMMUNIION SHORTAGE
In its 27 November edition, The Economist is reporting that 2 companies meet the bulk of US demand for ammunition, and chiefly through 2 long-established brands. Remington and Winchester Ammunition, and that soaring demand for guns and ammunition comes from a range of demographic groups.
PERU’S CHIEF OF STAFF STASHED $20,000 IN PALACE BATHROOM
On 26 November, the Panatimes reported that prosecutors in Peru have found $20,000 stashed in a bathroom inside the presidential palace after they raided the palace on Friday as part of an investigation into allegations of influence peddling. Bruno Pacheco, who has resigned, said that the stash was a combination of his savings and salary.
AFTER A YEAR OF SILENCE, ARE EU CYBER SANCTIONS DEAD?
On 26 October, an article on Lawfare posed this question, saying that a year ago the EU imposed its second, and so far last, cyber sanctions package in response to malicious cyber activities that constitute an external threat to the EU or its Member States. To date, only 8 individuals and 4 organisations have been sanctioned for various campaigns; whereas the US has listed including 13 individuals and 19 entities in 2021 alone.
COURT IMPOSES LIMITS ON THE EXTRATERRITORIAL REACH OF THE FCPA AND THE MONEY LAUNDERING CONTROL ACT
On 24 November, an article from Lowenstein & Sandler LLP said that the US District Court for the Southern District of Texas dismissed a 3-count indictment against Daisy Rafoi-Bleuler, a Swiss citizen residing in Zurich. The decision is said to demonstrate limits to the DoJ expansive interpretation of its own jurisdiction over foreign nationals in white collar criminal cases, and it raises the spectre of future due process constitutional challenges to prosecutions of so-called “agents” in corruption and money laundering cases.
WHAT TO DO WHEN THE NCA REFUSES YOUR APPLICATION FOR A DEFENCE AGAINST MONEY LAUNDERING (DAML)
On 25 November, an article from Jonathan Bray Ltd covers the situation when someone has submitted a DAML, answered further questions during the 7-day window, but then no more is heard – and the client is asking questions. What happens if you still hear nothing? It ends by saying that, whatever you do, make sure that you accurately record a detailed audit trail of your decision-making – warning that, if it isn’t recorded, it didn’t happen.
DO THE FCPA, UK BRIBERY ACT, FRENCH OR GERMAN CRIMINAL CODES MAKE A COMPANY LIABLE FOR THE ACTS OF MY SUBSIDIARIES AND EMPLOYEES?
On 23 November, an article from Reed Smith LLP explains the differing ways that the FCPA, UK Bribery Act, French and German criminal codes understand the liability of a company for the actions of its subsidiaries and employees. The article is the third of series of alerts from the firm.
HUMAN TRAFFICKERS GROUNDED IN 29-COUNTRY SWEEP OF EUROPEAN AIRPORTS AND ROADS
On 26 November, a news release from Europol advised that, between 8 and 12 November, Europol supported large-scale international action against trafficking in human beings. 29 countries, led by Austria and Romania, took part in the action days, which were coordinated by Europol and Frontex. The activities saw more than 14,000 law enforcement officers target trafficking routes on roads and at airports. This resulted in 212 arrests and the identification of a further 89 trafficking suspects.
SMALL-SCALE CHEMICAL AND BIOLOGICAL PRODUCTION: CURRENT THREATS AND FUTURE TRAJECTORIES
On 23 November, an Occasional Paper from RUSI says that chemical and biological weapons do not come out of nowhere. They are designed, developed and produced for specific purposes. The Paper analyses 2 central questions and makes policy recommendations to address the overall problem –
it assesses what resources are required for small-scale chemical and biological weapons (CBW) production; and
considers scientific and technical trends, and their impact on potential small-scale CBW production efforts.
MORE THAN 1,000 ARRESTS AND $27 MILLION INTERCEPTED IN MASSIVE FINANCIAL CRIME CRACKDOWN
A news release from Interpol on 26 November advised that over 4 months from June to September 2021, Operation HAECHI-II brought together specialised police units from 20 countries, as well as from Hong Kong and Macao, to target specific types of online fraud, such as romance scams, investment fraud and money laundering associated with illegal online gambling. In total, the operation resulted in the arrest of 1,003 individuals and allowed investigators to close 1,660 cases. In addition, 2,350 bank accounts linked to the illicit proceeds of online financial crime were blocked. More than 50 INTERPOL notices were published based on information relating to the operation and 10 new criminal modus operandi were identified.
END OF THE ROAD FOR ROMANIAN CRIMINALS TARGETING CARGO TRANSPORTS
On 26 November, a news release from Europol advised that an organised criminal group involving 30 Romanian nationals has been apprehended following an operation conducted by law enforcement authorities in France, Germany and Romania, supported by Europol and Eurojust. The group is suspected of thefts targeting cargo transport rest areas along main road haulage routes between Romania, France and Germany. The group – which was engaged in legitimate road haulage as cover – mainly targeted cargo shipments of alcohol and small electronics, stealing goods worth an estimated €2.5 million.
UK: FIREARMS – IMPORTATION SENTENCING GUIDELINES PUBLISHED
On 24 November, the Sentencing Council reported that it has published a new guideline for sentencing offenders convicted of firearms importation offences in England and Wales, following consultation. The guideline covers importation of firearms and ammunition under 2 Customs and Excise Management Act 1979 (CEMA) offences – improper importation of goods and fraudulent evasion of prohibition/restriction. It applies to adult offenders sentenced in magistrates’ court or the Crown Court on or after 1 January.
THE INTERNATIONAL COMPARATIVE LEGAL GUIDE TO GAMBLING 2022 – ISLE OF MAN CHAPTER
On 25 November, Appleby published the chapter of the 2022 guide which covers the situation in the Isle of Man – including relevant authorities and legislation, application for a licence, licence restrictions, digital media, enforcement, liability and anticipated reforms.
On 26 November, Hellenic Shipping News reported that a Danish naval patrol has killed 4 pirates in an exchange of fire in the Gulf of Guinea off the coast of Nigeria. A frigate had been patrolling the area since early November, and had attempted to board the pirate boat.
INDIA: OFFICIALS RAID PREMISES OF 3 SUCCESSFUL MOLLYWOOD PRODUCERS WITH HINTS AT INDUSTRY’S LINKS TO MONEY LAUNDERING
On 26 November, the New Indian Express reported that the Income Tax Department had carried out inspections at the office to 3 mainstream producers of the Malayalam film industry. A spokesman is quoted as saying that, as the film industry often attracts investments especially from abroad, we carry out such inspections on a regular basis… often film industry is used for laundering of money.
CHINA: FORMER EDITOR AT STATE-RUN NEWSPAPER GETS 13 YEARS FOR BRIBERY
On 24 November, Caixin Global reported that Ding Ting, a former editor of the Party’s official newspaper, the People’s Daily, has been sentenced to 13 years in prison for accepting and offering bribes.
SWITZERLAND RETURNS LOOTED RELICS TO SYRIAN AUTHORITIES
On 24 November, Swissinfo reported that 3 rare artefacts that were looted from Syria’s ancient city of Palmyra and stored at the Geneva freeport have been returned to Syrian authorities. The items, together with others from Yemen and Libya, had been confiscated by the Office of the Attorney General of Geneva in 2016, after arriving illegally in Switzerland between 2009-2010 and discovered during a routine inspection by Swiss customs in 2013.
OFFICE OF FOOTBALL AGENT JORGE MENDES SEARCHED AGAIN IN MONEY LAUNDERING INVESTIGATION
On 24 November, the Guardian reported that officers from Portugal’s tax and customs authority conducted more than 20 searches in connection with its investigation into tax evasion and money laundering at top-flight clubs, as well as the super-agent Jorge Mendes.
NORTH KOREA REELS IN CASH FROM FISHING PERMITS THIS YEAR, DESPITE UN BAN
On 26 November, NK Pro reported that ship-tracking data shows scores of Chinese vessels entered North Korea’s exclusive economic zone (EEZ) over the last several months, in what likely amounts to extensive violations of sanctions.
EUROPEAN COURT OF JUSTICE DISMISSED AN APPEAL AGAINST A GENERAL COURT’S DECISION OVER DAMAGES OVER IRAN SANCTIONS
On 26 November, the EU Sanctions blog reported that on 18 November, the ECJ dismissed and appeal against a decision to award an appellant €71,000 in non-pecuniary damages and €500 for each month in which his assets were frozen (€21,000 in total) – he had asked for over £1.4 million. The appeal had been brought by Fereydoun Mahmoudian, the majority shareholder and chairman of Fulmen, an Iranian company active in particular in the electrical equipment sector.
UK: HIGH COURT REJECTS HUMAN RIGHTS ACT CHALLENGE TO SANCTIONS LEGISLATION
On 26 November, the EU Sanctions blog reported that the High Court has dismissed an application by Hany Youssef challenging the compatibility of one part of the Sanctions Act with Article 6 of the European Convention on Human Rights which guarantees the right of access to a Court, and Article 8 which protects the right to private and family life.
On 26 November, 5 St Andrews Hill chambers published a video recording of a webinar on 17 November. It looks back on what might be considered the ‘first wave’ of carbon credit fraud, between roughly 2010-2015, and examines whether there is the potential for a new ‘second wave’ of more sophisticated, larger-scale fraud. It looks at the challenges for investigators in terms of embarking on investigations of such conduct and also those seeking to represent individuals accused of wrongdoing in the carbon markets?
UK: WARNING FOR TAXPAYERS NOT TO SHARE THEIR GOVERNMENT GATEWAY DETAILS– INCLUDING COMPANIES THAT OFFER TO MAKE TAX RELIEF CLAIMS ON THEIR BEHALF – DUE TO COMPANY REFUND FRAUD RISK
On 26 November, Accounting Web reported that the Low Incomes Tax Reform Group (LITRG) is warning taxpayers not to share their Government Gateway username and password details with anyone – including companies that offer to make tax relief claims on their behalf. LITRG has issued a list of fraud warning signs.
PODCAST: HOW THE CHARITY SECTOR CAN BE TARGETED BY FRAUDSTERS
On 26 November, Third Sector released a podcast about a broad range of fraudulent activity affecting the charity sector. These include where people falsely claim to be raising money on behalf of charities, where charity staff have been conned into handing over charity money, as well as cases of insider fraud, where charity staff, trustees or volunteers have directly stolen from the charity.
FORMER HEAD OF CZECH SOCCER ASSOCIATION GETS 6-YEAR PRISON TERM FOR FRAUD
On 26 November, the Daily Mail reported that Miroslav Pelta, the former head of the Czech soccer association, had been convicted of fraud and sentenced him to 6 years in prison. He was also fined $220,000 and banned him from an executive position in corporations for 5 years. In the same case dating from 2017 and involving misuse of state subsidies, the court sentenced Simona Kratochvilova, a former deputy education minister, to 6½ years in prison and banned her from working in state offices for 6 years and fined her $88,000.
UK: 3 CIGARETTE SMUGGLERS FRAUDSTERS JAILED FOR A TOTAL OF 8½ YEARS
On 26 November, Forecourt Trader reported that they were part of organised crime networks that operated in London and the Midlands, and were caught with more than 5 million cigarettes in November 2016.
LITHUANIA: CORRUPTION PROBE TARGETS PROPERTY DEVELOPMENT IN VILNIUS
On 26 November, LRT reported that the Special Investigation Service (STT) has announced an investigation into a possible inter-institutional criminal scheme involving employees of Vilnius city municipality.
UK: TREASURY COMMITTEE TO QUESTION MINISTERS ON FRAUD, SCAMS AND ECONOMIC CRIME
On 26 November, the Parliament website reported that Government ministers will be questioned by Parliament’s Treasury Committee on fraud, scams and economic crime at on 29 November. Following news that fraud increased by 30% in the first half of 2021, the Committee is likely to use the session to discuss the action required to tackle fraud and scams. It is said that the Committee may also use the session to explore what the Government is doing to stop the rise in authorised push payment (APP) fraud and to ensure that victims are reimbursed. Other topics of discussion could include effectiveness on the AML regime, and the need for more transparent ownership of companies and property to prevent criminals hiding money in the UK.
HONDURANS WEARY OF CORRUPTION LOOK FOR CHANGE IN ELECTION
On 26 November, ABC News reported that the upcoming election will be about removing a party whose successive administrations are widely seen as deepening the country’s corruption over the past 12 years, driving tens of thousands to flee the country.
HONG KONG: SFC ACTION OVER A SUSPECTED SOCIAL MEDIA RAMP-AND-DUMP SCAM INVOLVING MANIPULATION OF THE MARKET IN LATE OCTOBER 2021
A release on Mondo Visione on 26 November advised that the Securities and Futures Commission (SFC) has issued restriction notices to Emperor Securities Limited and Get Nice Securities Limited, prohibiting them from dealing with or processing certain assets held in 17 trading accounts.
Brazil: FORMER OLYMPICS BOSS SENTENCED TO JAIL FOR CORRUPTION
On 26 November, the New Indian Express reported that Carlos Arthur Nuzman, the head of the Brazilian Olympic Committee for more than 2 decades, has been sentenced to 30 years and 11 months in jail for allegedly buying votes for Rio de Janeiro to host the 2016 Olympics.
TRUSTS: UK PROPERTY OWNERSHIP STRUCTURE – REMEMBER TO REGISTER WITH THE UK TRUST REGISTRATION SERVICE
On 26 November, Herbert Smith Freehills issued a reminder that HMRC has expanded the scope of what trusts are required to register with the TRS such that all express trusts (save for a few limited exceptions), which are required to register irrespective of whether they have a liability for UK tax. It explains that whilst the legislation provides that affected trusts must register by 10 March 2022, HMRC has announced that, due to technical upgrades required, this deadline has been extended to 1 September 2022 (for trusts in existence on or after 6 October 2020).
UK: CASH AND CARRY BOSS JAILED FOR 5 YEARS FOR MONEY LAUNDERING
On 26 November, the Ilford Recorder reported that a Barking cash and carry boss, Avtar Singh Mann, 50, has been sentenced to more than 5 years in jail for his part in a £25 million money laundering scheme. He helped move millions of pounds through the bank accounts of shell companies set up to launder cash believed to derive from the sale of non-duty paid alcohol.
CAN THE BIOLOGICAL WEAPONS CONVENTION ADDRESS NEW BIOTHREATS?
On 25 November, an article from Chatham House says that the dual-use nature of many new biological techniques pose significant challenges for governance, particularly as new and complex synergies emerge between biology and other disciplines, such as chemistry, artificial intelligence (AI) and cyber technologies. Developments have diversified biothreats beyond what was originally conceived by the Biological Weapons Convention (BWC), introducing new and more interconnected pathways for the hostile use of biological agents. Parties to the BWC are meeting, and the article says that there is an urgent need to update the treaty regime by reframing discussions to properly address the complexity of modern-day biothreats.
OPERATION CLAMPS DOWN ON ILLEGAL TRANSBOUNDARY SHIPMENTS OF WASTE AND OZONE DEPLETING SUBSTANCES
A news release from the World Customs Organisation on 26 November advised that, from 1 to 31 October, Operation DEMETER VII demonstrated Customs’ commitment to helping to protect the health of both people and the planet, by enforcing Multilateral Environmental Agreements (MEA) which regulate cross-border movements of environmentally sensitive commodities. It tackled the illicit trafficking of waste, ozone depleting substances (ODS) and hydrofluorocarbons (HFC), which are very potent greenhouse gases that contribute to global warming and climate change. These commodities are regulated under, respectively, the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (Basel Convention), and the Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol). Using risk indicators and focusing on pre-identified routings and hotspots, Customs officers controlled suspicious shipments and seized illegal waste and ODS. It resulted in a total of 107 seizures, including 3,851 tons of waste and additional 6,108 pieces, and 101 kg and additional 493 pieces of substances controlled under the Montreal Protocol.
BANNING BINANCE AND THE CHALLENGES OF REGULATING CRYPTO
On 24 November, an article from Corker Bining examines the facts behind sensational headlines, which it says are emblematic of the tussle between investors, financial institutions, cryptoasset service providers, and regulators that has existed ever since cryptocurrencies came to mainstream attention. At the heart of this tussle are said to be questions about the cross-border regulation of cryptoasset companies, and the financial crime implications for investors and institutions who do business with Binance, and other cryptocurrency exchanges.
FINLAND: BLOCKFEST FOUNDER ACCUSED OF MONEY LAUNDERING
On 26 November, IQ Magazine reported that Kalle Kallonen, thefounder and CEO of Finland’s Blockfest festival has gone on trial accused of money laundering. He denies the charge of allegedly received cash earned from drug offences for €10,000 which he transported to Spain in May 2021. His is part of larger case in which aA total of 10 people have been charged, including 3 men who are alleged to have formed an organised criminal group to commit drug offences from 2020 to June 2021. Founded in 2008, Blockfest has grown to become one of the biggest hip-hop festivals in the Nordic countries.
On 25 November, a report from the Environmental Investigation Agency said that, despite trade sanctions imposed in June to ban imports of Myanmar teak into Europe, more than 300 tonnes of teak, worth well over €2 million, has since entered into Italy. It says that, in the first half of the year, more than €1 million worth of timber was entering into Italy every month, but in July this decreased to about €500,000 worth. However, with the sanctions in place there should be no timber entering at all and, subsequently, timber imports have increased.
On 25 November, Comicbook.com reported that Chinese media reports that 20 boxes of counterfeit Pokemon trading cards were seized at Shanghai’s Pudong Airport. They weighed over 7.6 tons and were bound for the Netherlands, where they would presumably be distributed around Europe.
On 25 November, an article from OCCRP reported that a former prison warden from Lithuania may have helped the regime of Belarusian dictator Alexander Lukashenko dodge sanctions by benefitting from a $1.1 million deal to export Belarusian trucks, made by sanctioned Belrussian state company BelAZ, through Lithuania’s biggest seaport.