Panama Covid-19 update – another day with over 900 new cases, and the positive test results over 12% (when the recommended WHO maximum is 5%). 932 new cases but no new fatalities. Active cases up by 431 to 6,066, but only 1 more person in ICU (now 11), with 84 others in other wards
30 APRIL 2022
HOW MILITARY TECHNOLOGY REACHES RUSSIA IN BREACH OF US EXPORT CONTROLS
On 29 April, a Thomson Reuters report from KFGO in the US concerns a criminal case involving a Russian and 2 Bulgarian businessmen and the supply of hardened computer chips. It is said to illustrate the challenges of imposing a rigorous export-control regime, especially on so-called dual-use components that can serve both civilian and military purposes. It reveals a chain of willing suppliers, front and shell companies and false claims on export forms that specialized Western components were intended for civilian rather than military use. Sought-after parts have included microelectronics and precision tooling for the Russian military. It is also said that a review by Reuters of US court and other federal records shows that this case isn’t unique.
IN JULY PARAGUAY AND ARGENTINA WILL KNOW RESULTS OF GAFILAT AML/CFT EXAMINATION
On 29 April, Ultima Hora and others reported that in the third week of July, the plenary session of the FATF-style regional body Gafilat is expected to be held in Ecuador, where the result of the AML evaluation that Paraguay has been facing will be revealed. Similarly, ABC in Argentina reported that its evaluation report will be presented at the same plenary session, with Argentina expecting a poor rating.
FIFTH OF UK BANKERS EARNING MORE THAN £125,000 A YEAR BENEFITED FROM NON-DOMICILED TAX STATUS
On 18 April, in the wake of the news that the Chancellor’s wife enjoyed non-dom status, the Mail Online reported that non-dom status – which exempts more than 75,000 mostly foreign nationals in Britain from tax on overseas income – is claimed by 20% of UK bankers earning more than £125,000 a year. The UK Health Secretary has also confessed he was a ‘non-dom’ while working as a banker earning up to £3 million a year, giving him the tax status between 2000 and 2006 before beginning his political career.
FRAUD: CHARTERED ACCOUNTANTS CALL FOR INVESTING IN GOVERNMENT COUNTER-FRAUD CAPABILITY AND ADDRESSING THE ASSURANCE GAP IN GRANTS DISTRIBUTED THROUGH LOCAL AUTHORITIES
On 29 April, ICAEW reported on evidence that it provided to the House of Commons’ Public Accounts Committee and which has now been published. It calls for the government to learn from COVID-19 business support grants by investing in BEIS’s counter-fraud capability and addressing the assurance gap in grants distributed through local authorities. The evidence focuses on the COVID-19 business support grant schemes and the important lessons for the government to learn for future use of local authorities as a partner to deliver priorities. In addition, ICAEW warned the estimate of £1.038 billion of fraud and error could be a significant under-estimate.
UK: NEW LAW ON RECOGNISING PROFESSIONAL QUALIFICATIONS GAINED OVERSEAS HAS NOW RECEIVED ROYAL ASSENT
A news release from the Department of Business, Energy and Industrial Strategy on 29 April advised that the Professional Qualifications Act 2022 revokes the previous EU system for how certain professional qualifications gained overseas are recognised in the UK, and which often gave preferential treatment to holders of qualifications from the EEA and Switzerland. It is said that UK regulators will now have the autonomy to decide on the right approach to recognising overseas professional qualifications.
UK: FRAUDSTER WHO PRINTED £12 MILLION IN LARGEST SEIZURE OF FAKE BANK NOTES IS JAILED
On 30 April, Yahoo News reported that Andrew Ainsworth, 61, was part of a gang that used specialist printing equipment to produce fraudulent £20 notes on an industrial scale. He has been sentenced to sentenced to 5½ years in prison. 3 other members of the criminal network were jailed for a combined total of 22½ years in January 2021.
IRELAND: WHEN INVESTIGATING SERIOUS CRIME, IS LAW ENFORCEMENT ENTITLED TO ACCESS MATERIAL WHICH WILL OR MAY IDENTIFY JOURNALISTIC SOURCES?
On 26 April, Irish law firm McCann Fitzgerald published an article saying that the Court of Appeal has outlined the parameters of journalistic privilege and set down a firm marker for An Garda Síochána (police) when applying for search warrants for the search and seizure of material that might reveal journalistic sources. The article also notes that, outside the criminal sphere, the judgment may have relevance to discovery in civil proceedings in that the court’s discussion on the scope of journalistic privilege could well inform decisions on when the production of a document can be refused on grounds of journalistic privilege.
US AND EU AGREE ON FRAMEWORK FOR PRIVACY SHIELD REPLACEMENT
Clifford Chance has produced this briefing, saying that, while the agreement is still “in principle” and specific details have yet to be determined, if approved, this agreement will reimplement an important legal mechanism necessary to facilitate data transfers between the EU and the US. It concludes that, while the prospect of a new Framework is great news for companies that routinely transfer data from the EEA to the US, for now companies must continue to rely on SCC (and upgrade to the European Commission’s new SCC by 27 December at the latest) and other transfer mechanisms to ensure they comply with the GDPR.
CORPORATE RE-DOMICILIATION: GLOBAL BRITAIN? WHY THE PROPOSED NEW UK REGIME MATTERS
An article from Clifford Chance says that the UK Government confirmed in April that it intends to introduce a UK corporate re-domiciliation regime, which would allow a foreign-incorporated company to change its place of incorporation to the UK whilst maintaining its legal identity as a corporate body. This has the potential to reduce significantly the complexity involved in the process of relocating to the UK. Companies looking to align the domicile of group companies with, for example, the location of key operations, corporate headquarters or tax residency will benefit from this proposed new regime.
CURATORS AT MAJOR MUSEUMS ARE INCREASINGLY GRAPPLING WITH A THORNY TOPIC: RESTITUTION
On 27 April, the New York Times carried an article saying that so-called looted works of art and how to return them to their rightful owners has become a major challenge for museums. This is tied to the appointment of a new curator at the Museum of Fine Arts in Boston, which has seen since 1997, 14 claims involving 43 objects have been resolved either by returns or through financial settlements.
US DoJ LAUNCHES NATIONAL LAW ENFORCEMENT KNOWLEDGE LAB
On 29 April, Homeland Preparedness News reported that a resource hub for law enforcement personnel has been launched that will promote constitutional policing, improve public safety, and build trust in communities. Law enforcement personnel would be able to access the Knowledge Lab to deploy voluntary resources that include research summaries, profiles of best practices, training curricula and a roster of constitutional policing experts.
TRAFIGURA SEEKS CONTROL OF ZIMBABWE’S METALS FOR UNPAID DEBTS
On 29 April, Yahoo Finance reported that Trafigura Group and Zimbabwe’s government have discussed a deal that would give the commodities trader control over output from some of the biggest mines as repayment for debts.
On 28 April, a report from Global Witness explains that minerals extracted by hand from the African Great Lakes region are in huge demand. The Democratic Republic of the Congo (DRC) and Rwanda produce nearly half the world’s coltan, the main ore of tantalum, as well as large amounts of tin and tungsten ores – collectively known as 3T minerals. The metals obtained from the smelted 3T minerals are widely used in electronic equipment such as mobile phones, computers and automotive and aeronautical systems. Due to concerns, industry interests set up traceability systems which, working alongside government validation of mines, were intended to establish a supply of “conflict-free”, responsibly sourced minerals. However, the report contains evidence of how the most widely used of these schemes – the International Tin Supply Chain Initiative (ITSCI), established in 2009 – appears to facilitate the laundering of minerals originating from mines controlled by abusive militias or that use child labour. Furthermore, it is said that the scheme many international companies are relying on to source responsibly, is also used to launder huge amounts of minerals that have been smuggled and trafficked, new evidence suggests.
This report published by Conflict Armament Research examines the use of a Diversion Analysis Framework (DAF), an analytical tool designed to help unpack the problem of diversion. The Framework is part of a wider research project through which the 3 partner organisations hope to support Arms Trade Treaty (ATT) States Parties in understanding the impact of the Treaty in addressing diversion risks associated with arms transfers. It draws on findings from CAR field investigations of weapon diversion in conflict-affected locations to illustrate how the DAF can be applied to real-world cases. These studies also explore what measures States that have been involved in such cases have introduced to create or strengthen an ‘enabling environment’ to better prevent, mitigate, and address cases of diversion.
A report from Conflict Armament Research says that a wide spectrum of materials can be used to manufacture improvised explosive devices (IED). These include both military and civilian commercial products. The variety in design and means of deployment of IED vastly complicates efforts to regulate and control their proliferation. The UN General Assembly has repeatedly stressed the urgent need to prevent illicit actors from obtaining and using materials to produce IED. CAR investigators have been working to document and trace components, subcomponents, and materials like commercial explosives that can be used to create IED. The report presents case studies from CAR investigations that demonstrate examples of upstream IED prevention in action. It highlights the importance of field documentation, analysis, and tracing to provide governments, manufacturers, and distributors with verified evidence on patterns of illicit production and procurement of IED materials.
On 30 April, the Guardian reported that the acting premier has said he opposes a recommendation that the UK take direct control of the territory after his predecessor appeared in a US court on charges linked to drugs trafficking. BVI operates under a 2007 constitution that gives them limited self-governance under a Governor who is the ultimate executive authority as the representative of the Queen. However, an inquiry into corruption in the territory recommended the Governor take direct rule of the territory for 2 years, saying that “Almost everywhere, the principles of good governance, such as openness, transparency and even the rule of law, are ignored”.
On 29 April, OCCRP published a report saying that the RCB Bank was set up and owned by VTB, a Russian bank dubbed Putin’s “piggy bank” and that, despite making moves to obscure its Russian ties following the invasion of Ukraine, current and former RCB executives have ties to the Kremlin and acquired Cypriot passports under dubious circumstances.
Panama Covid-19 update – all the numbers (including the positive test results) reported today up again, with the overall number of active cases up by nearly 400 – worrying when on 2 crowded buses, although here masks remain mandatory on public transport. Relaxed by feeding a family of racoons on dog biscuits…
No new fatalities reported, but 939 new cases reports and 5,635 active cases. The hit rate on the 7,639 tests up again, to 12.3%. Meanwhile, there are just 10 patients in ICU, 75 in other wards, with another 17 in quarantine in the hospital-hotels.
29 APRIL 2022
TRAFIGURA GROUP IS CUTTING OFF RUSSIAN GIANTROSNEFT OILFROM GLOBAL OIL MARKETS
On 28 April, the Wall Street Journal reported that Russia hitherto depended on foreign middlemen to ferry its most strategic and lucrative export around the world: oil. Now the Swiss commodities trader plans to stop exporting Rosneft’s crude oil. It will cut its business with the state producer to a sliver of pre-war levels, supplying only some refined products such as diesel into Europe.
On 15 March, ENACT Africa published an article saying that cheap and deadly counterfeit drugs are found around every corner in Gabon’s major cities, despite their dangers. It explains that unlicensed medicinal drugs started appearing on Libreville’s streets decades ago and continue to increase in range and accessibility. They were smuggled into Gabon from Benin, Côte d’Ivoire, Ghana, Nigeria and India, where original pharmaceutical products are substituted with a substandard drug that either excludes an active ingredient or contains a toxic substance.
On 21 April, an article in ENACT Africa says that mafia groups are increasingly involved in global waste disposal, putting North African citizens at risk. Toxic waste is a billion-dollar industry for criminal networks and a life-threatening hazard. Waste is shipped from Europe to legitimate pollution-control countries in North Africa for recycling. However, these countries don’t always have the technical means to recycle the waste.
EVIDENCE FROM CASE STUDIES OF FOREIGN CRIMINAL ACTORS OPERATING IN EAST, WEST AND SOUTHERN AFRICA
On 14 April, ENACT Africa published a paper saying that foreign criminals are a significant presence in Africa. 4 typologies of foreign criminal actors are identified, allowing an exploration into why some actors develop more successful criminal enterprises than others. Success appears to be the result of a slow embedment in the local criminal economy, avoiding displays of wealth and the targeted corruption of officials. It also depends on the expansion of ethnic networks where high levels of trust or coercion of members prevent law enforcement penetration. Eroding these successful criminal operations requires an ability to disrupt recruitment into the networks and ultimately their more effective integration into legitimate economic activities.
IMPACTS OF NEW TECHNOLOGIES ON TERRORISM FINANCING RISKS
On 5 April, RUSI published an Occasional Paper which investigates the potential terrorist financing risks that new technologies may pose. With their focus on speed, efficiency and a positive user experience, new technologies not only have the potential to make life easier for ordinary consumers, but also to reduce the frictions terrorist financiers face when funding attacks and organisational activities.
On 29 April, various sources reported that Panama has just approved a Law that regulates the use of cryptocurrencies. The Law seeks to strengthen the public and private use of digital assets, including the payment of taxes.
JUDGE IN GUATEMALA ORDERS RETURN OF AIRCRAFT OWNED BY RICARDO MARTINELLI
On 28 April, Panama America reported that a judge has ordered the return of the aircraft owned by former Panamanian President Martinelli that had carried his 2 sons, who were detained and subsequently extradited to the US on money laundering charges.
IRAQ: BRITISH AND GERMAN TOURISTS DETAINED IN BAGHDAD ACCUSED OF SMUGGLING ANTIQUITIES
On 29 April, Middle East Eye reported that the tourists accused of trying to smuggle antiquities out of Iraq have been detained in Baghdad and possibly face the death penalty or imprisonment, with relatives accusing the travel company and embassy authorities of letting the pair down. One is 66-year old British retired geologist, James Fitton. Their tour group was found with 32 artefacts – believed to be small fragments with little to no commercial value – at the airport.
HMRC WAIVES FINES FOR MILLION BRITS UNWITTINGLY CAUGHT IN AML CRACKDOWN
On 29 April, City AM reported that HMRC has said it is waiving fines for those who unwittingly faced penalties for failing to list any trusts they own on AML registers, following the introduction of new rules requiring trustees to list any trusts on official registers. The new rules could mean thousands of people who are unaware they are now required to register their trusts could face hundreds of pounds worth of fines.
UK: 10-YEAR DRUGS PLAN TO CUT CRIME AND SAVE LIVES
On 29 April, the Home Office published a 10-year plan which aims to cut crime and save lives by reducing the supply and demand for drugs and delivering a high-quality treatment and recovery system. The plan sets out 3 core priorities: break drug supply chains, deliver a world-class treatment and recovery system, and achieve a shift in the demand for recreational drugs.
INTERNATIONAL COMPARATIVE LEGAL GUIDE TO: TRADE MARKS 2022
On 28 April, law firm Bird & Bird published the latest edition of this guide (others are available on copyright, patents and designs). It is described as a practical cross-border insight into trade mark law. The firm contributed 2 chapters covering trade mark exhaustion and an update on trade mark law in the UK.
6 GENOVESE CRIME FAMILY MEMBERS CHARGED IN NEW YORK
On 29 April, OCCRP reported this news from the US, serving to remind one that traditional mafia crime organisations are still operating. The Genovese crime family is the successor to the gang established in the 1930s by Charles “Lucky” Luciano, described as the godfather of the American mob who rose to prominence during the Prohibition era.
JORDAN: A BUSINESSMAN, THE KING’S UNCLE, SENTENCED FOR CORRUPTION
On 28 April, OCCRP reported that a Jordanian businessman related to the royal family has been sentenced to 18 years of hard labour and fined $269 million for corruption and abuse of office. Walid Al-Kurdi is married to Jordan’s King Abdullah II’s aunt Princess Basma Bint Talal, and the charges relate to his work as head of the state-owned mining company Jordan Phosphate Mines (JPMC).
UK AND ROMANIA: CRIMINAL NETWORK INVOLVED IN HUMAN TRAFFICKING, LABOUR EXPLOITATION AND MONEY LAUNDERING
A news release from Europol on 29 April advised that Romanian and UK police, supported by Europol and Eurojust, have dismantled a criminal network involved in human trafficking, labour exploitation and money laundering. Active since early 2018, the criminal network lured vulnerable people in unstable financial situations by offering them jobs in the UK.
NEW ENGLISH WITNESS EVIDENCE RULES LIKELY TO INFLUENCE WIDER BEST PRACTICE
An article from Out-Law on 28 April said that businesses involved in disputes before a wide range of courts and tribunals should expect their factual witness evidence to be closely scrutinised and should be aware of best practice principles recently set out by one of the main branches of the English courts, the Business and Property Courts (BPC) in England and Wales. New rules on the preparation of trial witness statements were introduced in April 2021. It refers to concerns relating to the fallibility of human memory expressed in a 2020 report published by the International Chamber of Commerce (ICC).
SPAIN BANS TANKER OVER RUSSIAN CARGO TRANSFER AT SEA
On 28 April, Lloyds List reported that a Malta-flagged chemical tanker had been banned from Spanish ports after undertaking ship-to-ship transfer of palm oil from a Russia-flagged tanker off Malta in breach of new EU port ban. It says that intensified scrutiny of carriage of Russian cargoes has led to increased ship-to-ship transfer activity at key ports near Europe.
NORWAY TO CLOSE ITS BORDERS AND PORTS TO RUSSIAN TRUCKS AND SHIPS, JOINING SANCTIONS IMPOSED BY THE EU
On 29 April, the Guardian reported that Russian fishing vessels, which often land their catch at ports in northern Norway, and Norway’s Arctic Svalbard archipelago, which operates under a 1920s treaty allowing expanded foreign access, will be exempt from the ban.
UK: MINISTERIAL STATEMENT ON IMPORT CONTROL – FURTHER DELAYS TO POST-BREXIT CONTROLS
On 28 April, CILT reported that the remaining import controls on EU goods will no longer be introduced this year, the UK Government has announced. Instead, traders will continue to move their goods from the EU to Great Britain.
On 29 April, Loadstar reported that furious port operators are threatening legal action after the UK government’s decision to delay indefinitely, or scrap, phytosanitary checks, the final post-Brexit border control policy. They claim the move puts UK exporters at a competitive disadvantage.
SANCTIONING RUSSIA RAISES QUESTIONS ON OTHER CURRENCIES
On 29 April, an article in Hellenic Shipping News from PIMCO says that it believes that emphasis will shift to currencies of countries deemed as sanctions-remote. It also says that it believes the US dollar will come out at least as strong as before, while the picture for the renminbi is more clouded.
The FBI has issued this report, saying that, working with the DoJ Elder Fraud Initiative and other internal and external partners, the FBI is committed to identifying, investigating, and prosecuting criminals who target seniors. The Internet Crime Complaint Center (IC3) is a key component in this endeavour, as it provides victims a venue to identify the subject and the fraud committed against them. The number of elderly victims has risen at an alarming rate, while the loss amounts are even more staggering. In 2021, over 92,000 victims over the age of 60 reported losses of $1.7 billion to the IC3. This represents a 74% increase in losses over losses reported in 2020.
UNDERSTANDING AL-QAIDA IN THE ISLAMIC MAGHREB (AQIM) EXPANSION INTO WEST AFRICA
On 29 April, this report from the Combating Terrorism Center argues that over the past 30 years Al-Qaida and its branches and allies in North and West Africa have followed what this report calls its “Imperial Playbook”, as they have sought to expand their areas of influence southward. The “playbook,” this report shows, is composed of 5 fundamental tactics: befriending or creating militant groups operating in the midst of conflict; integrating themselves into communities where those militants exist; exploiting grievances of those communities to gain sympathy; addressing internal or external dissent either passively or aggressively; and looking toward new theatres once their base is solidified.
RUSSIA-RELATED COMMODITY RESTRICTIONS AND PORT BANS AS OF 25 APRIL
Another infographic from ACAMS, the table sets out key commodity restrictions imposed against Russia by a number of jurisdictions. While individual designations against an individual or entity can carry an impact on commodities, this infographic is focused on direct restrictions targeting commodities themselves, as the impact of designations can be unclear. ACAMS has also included port access within this table, since this relates to commodities.
ISLE OF MAN: THE RUSSIA (SANCTIONS) (EU EXIT) (AMENDMENT) (NO. 9) REGULATIONS 2022
A news release from the Isle of Man on 29 April advised of the effects of the above Regulations. They provide for a number of restrictions in the form of trade in services sanctions. Separately, the always-useful EU Sanctions blog summarised the content of the UK regulations concerned –
Social media services, including video sharing platforms, to take reasonable steps to prevent content that is generated, uploaded or shared by a designated person/entity being encountered by a UK-based user;
internet access services, including fixed and wireless broadband providers, to take reasonable steps to prevent UK-based users from accessing websites provided by a designated person/entity; and
application stores, including those on smartphones, to take reasonable steps to prevent UK-based users from downloading or otherwise accessing an application provided by a designated person/entity.
COUNTERING A RESURGENT TERRORIST THREAT IN AFGHANISTAN
On 14 April, the Council on Foreign Relations think-tank in the US published an article saying that, with al-Qaeda and the self-proclaimed Islamic State in Khorasan growing in strength since the US withdrawal, it lays out a strategy for the US to prevent a renewed terrorist threat from emerging in Afghanistan.
CANADIAN PARLIAMENT IS CONSIDERING PROPOSED LEGISLATION THAT WOULD ALLOW FOR THE FORFEITURE AND DISTRIBUTION OF A SANCTIONED PERSON/ENTITY’S PROPERTY FOR HUMANITARIAN PURPOSES
On 29 April, the EU Sanctions blog reported that the 2 pieces of proposed legislation that would allow for the forfeiture and distribution of a sanctioned person/entity’s property for humanitarian purposes.
FinCEN ACTING DIRECTOR REPORTS ON EFFORTS TO IMPLEMENT AMLA
On 28 April, a news release from FinCEN said that the Acting Director had testified before the US House Financial Services Committee on the status of proposed rules to implement the Anti-Money Laundering Act 2020 (AMLA). He described 3 proposed rules to implement the statutory requirements of AMLA corporate transparency provisions (CTA) on anonymous shell companies. He also said that FinCEN is working with the Treasury Office of Terrorist Financing and Financial Crimes to “better understand” the unique AML/CFT risks of advisory activities; and that an Advance Notice of Proposed Rulemaking had been issued to address money laundering weaknesses in the US real estate market.
IRAN: DRONES AND DIRECTED ENERGY AT CENTRE OF PROCUREMENT NETWORK
On 28 April, the Wisconsin Project on Nuclear Arms Control published an article saying that, from 2017 to 2018, an Iranian procurement network attempted to export sensitive counter-drone technology from the US to Iran. The CEO of a telecommunications company in the UK was involved, using the British company as a front. The man behind the attempt, Iranian national Jalal Rohollahnejad, is still active in Iran. The network sought systems that would have required a licence from OFAC to be exported from the US to Iran – Industrial Microwave Systems (IMS) and counter-drone systems.
GUERNSEY TO DELAY TAX REFORM DEBATE TO EXPLORE CORPORATE TAX OPTIONS
On 29 April, Wolters Kluwer reported that Guernsey had announced that a parliamentary debate on tax reform, scheduled for July, will now be delayed until the end of the year, to allow time for consideration of corporate tax options. Previously, Guernsey’s Policy and Resources Committee proposed that Guernsey could implement a goods and services tax to buoy finances. The introduction of a GST with either a 5% or 8% rate was included in 2 of 3 options put forward by the Policy and Resources Committee, which was asked to identify potential sources of revenue for the government. The alternative was proposed to be a 3% “health tax”, levied through the social security system.
500 SEAFARERS REMAIN TRAPPED ON VESSELS STUCK IN UKRAINIAN PORTS
On 29 April, Hellenic Shipping News reported that just under 500 seafarers remain sheltered awaiting evacuation onboard 109 ships at Ukrainian ports in the Black Sea and the Sea of Azov, down from 2,000 6 weeks ago. Around 1,500 have now been evacuated from their stranded vessels, according to new data gathered by the International Chamber of Shipping, collated in association with the IMO.
THE J5 JOINT CHIEFS OF GLOBAL TAX ENFORCEMENT LISTS ‘RED FLAG INDICATORS’ OF FRAUD IN NFT MARKETPLACES
OODA Loop reported that the international tax consortium has issued a list of “red flag indicators” of fraud in non-fungible token (NFT) marketplaces to help banks, law enforcement and private industry crack down on criminal activity. The J5 is made up of representatives of tax agencies from Australia, Canada, the Netherlands, UK and the US, and is tasked with sharing information and coordinating operations to fight international tax crime.
On 29 April, Weiner Brodsky Kider PC reported that the Office of the Comptroller of Currency in the US OCC recently issued a final rule which amends the OCC suspicious activity report (SAR) regulations and allows the agency to exempt certain financial institutions from the requirements of SAR regulations upon written request, and it harmonises the OCC’s legal authority with the exemption authority of FinCEN.