Panama Covid-19 update – no cases reported here, yet, but the health ministry has announced an alert over the risk of monkeypox…
Meanwhile, on the Covid front, the number of active cases up again, and positive results from tests remain above 20%. 3 new fatalities reported, together with 3,825 new cases; there now being 29,029 recorded active cases, with 39 in ICU and 211 in other wards.
25 MAY 2022
ISLE OF MAN: RUSSIA SANCTIONS GENERAL LICENCE RE RAIL AND FLIGHT TICKETS
On 24 May, the Isle of Man issued a General Licence allows payments and other permitted activities to take place in relation to the purchase of tickets from a designated person or any subsidiary for flights or rail journeys originating in, or within, Russia. The licence will expire on 23 May 2023.
WHAT IS THE BACKGROUND TO THE REVIEW OF THE SERIOUS FRAUD OFFICE?
On 23 May, Reed Solicitors published an article seeking to answer this question and referring to the independent review which was ordered after the conclusion by 3 Court of Appeal judges that the SFO failed to disclose key information, which led to a businessman being jailed for bribery. The article sets out to look at the background of the SFO review requested by the Attorney General, what we can expect from the review and the potential impact on the SFO.
HAGUE CONVENTION LETTERS OF REQUEST – THE RELEVANCE THRESHOLD
On 9 May, Collyer Bristow LLP published an article about Hague Convention letters of request used by parties in overseas disputes to obtain evidence from, or to compel the disclosure of documents by, parties located in the UK. Litigants from Hague Convention countries can ask their home courts to seek assistance from the High Court of England and Wales by issuing a letter of request (LOR) to obtain the evidence or documents. One (seemingly) important point made is that there is a burden on the applicant to establish that the documents sought in fact exist. In this case, the evidence produced by the applicant made it clear that they did not know whether documents existed within the requested category and the applicant was merely ‘fishing’.
UPDATE ON US NUCLEAR INDUSTRY EXPORT RESTRICTIONS TO RUSSIA
On 23 May, Morgan Lewis & Brockius LLP pointed out in an article that a specific licence from the Nuclear Regulatory Commission (NRC) was needed for many exports of radioactive material to the Russian Federation even before the Russian invasion of Ukraine. However, since 17 May, any radioactive materials that you previously could export from the US under a general licence now requires NRC prior approval through issuance of a specific licence. The regulatory changes also apply to nuclear industry-related equipment, which may be subject to the Commerce Department EAR regime, which has also been tightened.
US LUMBER PRICES COULD BE AFFECTED BY SANCTIONS ON RUSSIA
On 23 May, a briefing from K+L Gates LLP pointed out that Russia is a major exporter of wood in the global market, particularly in China and the EU. If these countries restrict wood products imports from Russia, or if Russia refuses to export to them, the strain on global supply could drive domestic prices to new heights as Russia-dependent markets look for new sources of wood, and that there is already significant upward pressure on domestic lumber prices in the US.
EU PLANS TO HELP MEMBER STATES CONFISCATE ASSETS FROZEN BY SANCTIONS
On 11 May, Politico reported that the European Commission had put forward a draft Directive which would make sanctions evasion an EU crime. That step, in turn, would provide countries with the legal basis to confiscate frozen assets. However, Politico now reports that reveal there is not yet agreement on the proposal of making sanctions evasion an EU crime — suggesting leaders may have to discuss the proposal at their meeting next week.
FOREIGN VOLUNTEERS IN UKRAINE: SECURITY CONSIDERATIONS FOR EUROPE
On 6 May, an article from the International Centre for Counter-Terrorism says that around 20,000 people have travelled to Ukraine to join a force which was specifically created to offer foreign citizens the possibility of joining the resistance against the Russian invaders. The ICCT says that past research and experience raise some points of consideration related to people travelling abroad to fight wars in other countries. The article outlines several of these considerations relevant to volunteers in Ukraine, which may have implications for European governments. It will assess the security risks posed by volunteers travelling to Ukraine. Will they, as some fear, create a blowback in the way foreign terrorist fighters have done in the past? It also points to some other risks that might emerge, depending on how the war will be waged on the Ukrainian side. It does point out that foreign volunteers travelling to Ukraine to fight in the war are very different from the foreign terrorist fighters who went to join ISIS in the Caliphate (and are being treated differently, without the threat of prosecution)
MILITIA VIOLENT EXTREMISTS IN THE US: UNDERSTANDING THE EVOLUTION OF THE THREAT
On 20 May, a briefing from the International Centre for Counter-Terrorism says that such militants pose a growing threat within the US, and typically organise in small local or regional militias, though many movement participants do not affiliate with a specific organisation. However, they have organised loose umbrella networks at the national level, most notably the Oath Keepers and Three Percenters, while others have coalesced around specific memes or ideas.
ALREADY SWAMPED US SEAPORTS ARE BRACING FOR AN EARLIER PEAK SHIPPING SEASON
On 24 May, the Wall Street Journal warned that the seaports are stretched to their limit just as retailers and manufacturers are set to begin their seasonal rush of importing ahead of the Fall and end-of-year holidays. It says that this year’s peak shipping season is expected to start weeks earlier than usual, at the end of June, just as back-to-school and other seasonal products flood in. It reports that already warehouses are full, trucking companies and railroads are short workers and equipment, and container yards at ports are jammed with hundreds of thousands of boxes. Even a gradual increase in container volumes this peak season could present a challenge for ports.
BILLIONAIRE ROBERT BROCKMAN FOUND COMPETENT TO STAND TRIAL FOR TAX EVASION
On 24 May, the Wall Street Journal reported that a federal court has held that the Texas automotive-software mogul was exaggerating his symptoms of dementia in an effort to avoid prosecution and a potentially lengthy prison sentence. He was indicted in October 2020 for charges relating to an alleged scheme to evade taxes on about $2 billion in income. Prosecutors have called it the biggest tax-fraud case ever brought against an individual in US history.
HONG KONG AND MACAU POLICE ARREST 22 OVER MONEY LAUNDERING SYNDICATE
On 25 May, the South China Morning Post reported that police arrested 4 alleged core syndicate members during joint operation codenamed ‘Deferscheme’ in a series of raids. The money is said to be linked to 32 cases of deception, including 15 phone scams, 6 investment frauds and 5 internet love swindles.
FRENCH POLICE SEARCH MCKINSEY’S PARIS OFFICE IN TAX FRAUD PROBE
On 25 May, Yahoo News reported that police searched the Paris office of US management consultancy McKinsey as part of an investigation into suspected tax fraud, after the French Senate in March alleged that the firm was not paying corporate taxes in France. The report for the Senate said that McKinsey, which has been present in France since 1964 had not paid corporate taxes in France over the last 10 years, and had used a system of “tax optimisation” through its Delaware-based parent company.
BRIEFING: LOOT BOXES IN VIDEO GAMES
On 25 May, the House of Commons Library published a briefing paper saying that concerns have been raised about the structural and psychological similarities between loot boxes and gambling and that they can encourage children to gamble.
THE FOOTBALL INDEX COLLAPSE – A TIMELINE
On 25 May, the House of Commons Library published a briefing paper explained that BetIndex Limited, trading as Football Index, was a sports betting platform that launched in 2015. It allowed customers to place bets on the performance of footballers. In March 2021, BetIndex suspended operations and appointed administrators, and press reports suggested that its customers could lose more than £90 million.
SUSPECTED HEAD OF CYBERCRIME GANG ARRESTED IN NIGERIA
A news release from Interpol on 25 May advised that the cybercrime unit of the Nigeria Police Force arrested a 37-year-old Nigerian man in an international operation spanning 4 continents. He is alleged to have run a transnational cybercrime syndicate that launched mass phishing campaigns and business email compromise schemes targeting companies and individual victims.
CHELSEA FC SALE COMPLETED AFTER ROMAN ABRAMOVICH AGREES TO GOVERNMENT TERMS
On 25 May, the Guardian reported that the £4.25 billion takeover of Chelsea football club has been completed after Roman Abramovich agreed to the UK government’s terms for the sale. The Culture Secretary said that the UK Government issued a licence that permits the sale.
DOZENS OF PHANTOM COMPANIES CREATED IN THE UK
On 24 May, Byline Times reported that a number of companies have been incorporated in Companies House this year whose owners are oblivious to their existence and whose registered addresses are not authentic. The goal, experts say, may be to set up bank accounts, use the overdraft facility and let the real owners foot the bill.
FBI SEEKS ARREST OF SPANIARD CLAIMING TO BE NORTH KOREA CRYPTOCURRENCY ‘SPECIAL DELEGATE’
On 24 May, the Guardian reported that the FBI has issued an arrest warrant for a Spanish man – Alejandro Cao de Benós, 47 – who claims to be a “special delegate” working for the government of North Korea, accusing him of recruiting a cryptocurrency expert in an attempt to help DPRK circumvent US sanctions. The FBI alleges that he began organising a “Pyongyang blockchain and cryptocurrency conference” for the benefit of North Korea in early 2018.
PODCAST: “INSIDE THE IRAQI KLEPTOCRACY”
In the latest TRACE podcast, Robert Worth, a journalist previously based in Baghdad with the New York Times and author of A Rage for Order: The Middle East in Turmoil from Tahrir Square to ISIS, describes the deadly and intractable problem of corruption in Iraq. He discusses the role the US and its pallets of cash played in this, but also the enforced sectarian apportionment of power — the Muhasasa — that ensures each group protects its fiefdom rather than acting in the best interest of the whole country.
DANGEROUS COUNTERFEIT DRUGS ARE PUTTING MILLIONS OF US CONSUMERS AT RISK
An article in The Conversation on 25 May reported on a new study published in the Annals of Pharmacotherapy that says that the FDA took 130 enforcement actions against counterfeit medication rings from 2016 through 2021. It says that these operations involved tens of millions of pills, more than 1,000 kg of active ingredient powder that could be turned into pills in the US and hundreds of millions of dollars in sales. Unfortunately, these actions barely scratch the surface of the internet-based threat. China, India, Turkey, Pakistan and Russia were the most common countries supplying US consumers with counterfeit drugs.
THE COMMANDER OF US SPECIAL OPERATIONS COMMAND AFRICA LIKENS THE WAGNER GROUP TO A TERRORIST ORGANISATION
On 19 May, Breaking Defense reported that the rear-admiral described the Russian private military organisation as a “destabilising force” on the African continent similar to that of a terrorist group. The Wagner Group is a paramilitary organisation that Western governments suspect is a proxy force for the Russian military, carrying out the Kremlin’s foreign policy goals while maintaining plausible deniability. Its fighters have deployed to Syria, Yemen, Libya, Sudan, Mozambique, Madagascar, Central African Republic, and Mali.
OFAC ISSUES RUSSIA GENERAL LICENSE 13A
On 25 May, OFAC announced a General License authorising certain administrative transactions prohibited by Directive 4 under Executive Order 14024 (Prohibitions related to transactions involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation).
THE $86 MILLION RISE AND FALL OF INIGO PHILBRICK
On 25 May, the Guardian carried an article about “the suave American dealer”, with a gallery at an exclusive London address, a Midas touch that brought soaring profits in art sales and a socialite girlfriend from reality TV show Made in Chelsea. He had in fact been running a fraudulent business and has been sentenced to 7 years in a US jail, with 2 years of supervised release and an order “to pay a forfeiture of $86,672,790”.
CHINA’S ROSEWOOD TRADE WITH MALI RIGGED WITH ILLEGALITIES
On 25 May, OCCRP reported on a new report from an NGO that says that China’s rosewood imports from Mali, one of its leading rosewood suppliers, have led to the devastation of Malian forests and served as a conduit for ivory smuggling. Most of the demand for rosewood comes from China, where it is used to produce Ming dynasty-style furniture, popular among the country’s new rich. West Africa quickly grew into China’s leading rosewood supplier, and in 2020, comprised over 70% of Chinese rosewood imports.
MEXICO TO FILE NEW LAWSUITS AGAINST US FOR ILLEGAL ARMS TRAFFICKING
On 19 May, Prensa Latina reported that Mexican Foreign Secretary Marcelo Ebrard has announced that his government will file lawsuits for illegal arms trafficking. These new lawsuits would be added to that filed by Mexico in a Massachusetts court against 11 arms manufacturing companies in the US in August 2021, which it accuses of negligent trade that has killed thousands of people in Mexico.
US: MASSIVE FRAUD SCHEME INVOLVING SPORTS BETTING
A news release from US DoJ on 25 May claimed that a New York man charged had led a group that made tens of millions of dollars misleading victims into believing the group had inside information on college and professional sporting events. Cory Zeidman was charged with conspiracy to commit wire fraud, mail fraud and money laundering conspiracy in connection with a sports betting fraud scheme he operated from Long Island and Florida.
PANAMA: RESULTS OF FATF FACE-TO-FACE MEETING TO BE REVEALED IN JUNE
On 25 May, La Estrella de Panama reported that the Deputy Minister of Economy and Finance had said that the results of Panama’s face-to-face with FATF over the progress that the country has made in the action plan to leave the grey list, will be announced during the presentation of the joint report at a meeting of the Global Forum in mid-June.
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