On 8 June, MONEYVAL released this report saying that improvements in fighting money laundering and terrorist financing have led to upgraded ratings. It goes on to say that positive steps taken by the authorities have led to the upgrade of Hungary from “partially compliant” to “largely compliant” in 3 areas related to correspondent banking relationships, internal controls in financial institutions and transparency and beneficial ownership of legal persons. All in all, it is said, Hungary has succeeded in meeting the general expectation of MONEYVAL for countries to have addressed most – if not all – of the technical compliance deficiencies within 5 years after the adoption of the mutual evaluation report. However, Hungary will remain in enhanced follow-up and will continue to report back to MONEYVAL on progress to strengthen its implementation of AML/CFT measures, and is expected to report back in 2 years’ time.
A post from the Office for Financial Sanctions Implementation on 8 June explains how OFSI has recently updated its Monetary Penalty guidance, as well as outlining its ongoing enforcement approach, in light of changes to its enforcement powers introduced by the Economic Crime (Transparency and Enforcement) Act 2022. For breaches of financial sanctions that are committed after 15 June, OFSI will be able to impose civil monetary penalties on a strict civil liability basis – and won’t have to prove that a person had knowledge or reasonable cause to suspect that they were in breach of financial sanctions. However, OFSI continues to emphasise the importance of self-disclosure as a potential mitigating factor. OFSI has also gained the power to publicise details of financial sanctions breaches committed after 15 June where a monetary penalty has not been imposed. It has also introduced flexibility in the review process for monetary penalties, so that reviews requested after 15 June may now be undertaken by someone other than a minister.
On 7 June, CSIS published this case study which explores how Chinese diplomatic, regulatory, financial, and commercial actors work in concert to secure critical minerals in the West African nation of Guinea. Efforts in Guinea to mine bauxite and iron ore, the primary inputs for aluminium and steel, illuminate Beijing’s conduits for influencing and supporting its geo-economic objectives. Examining one key Chinese player in Guinea’s mining sector, this study highlights state actors’ connections with nominally private Chinese companies and the importance of partnerships with state-owned enterprises for building costly infrastructure. Across multiple bauxite and iron ore mining ventures, Chinese diplomatic support and state financing provided conduits to help further favoured projects and increase Chinese companies’ access to Guinea’s mining industries.
Panama Covid-19 update – just received my negative PCR test results, whilst the daughter still languishes in quarantine…meanwhile, the fifth wave rumbles on – though interestingly, it is reported that the lethality has dropped (presumably because of the prevalance of Omicron strains) from 1% to 0.9%.
Today saw 3,523 new cases and 3 new fatalities reported; with 33 in ICU and 263 in other wards. There are 26,583 active cases, and testing results (notwithstanding mine!) remains high at 21.9%.
7 JUNE 2022
RUSSIAN-OWNED SUPERYACHT IN FIJI NOW FLYING US FLAG
On 6 June, a video report from SuperYacht News from eSysman said that the superyacht Amadea, detained in Fiji was now flying a US flag, had a replacement crew and was set to leave Fiji, subject to a final hearin at the Fijian Supreme Court.
OVERVIEW OF WAYS TO LEGALLY AND PRACTICALLY PROTECT YOUR COMPANY FROM INDUSTRIAL ESPIONAGE
On 3 June, an article from Squire Patton Boggs asserts that companies can be at risk from internal and external sources of industrial espionage, in an attempt to gain an unfair competitive advantage or disrupt operations. It goes on to outline some legal and practical steps one can take in the US.
THE MEANING OF A “PERSON DISCHARGING MANAGERIAL RESPONSIBILITIES” IN SECURITIES FRAUD LITIGATION
On 6 June, an article from Stephenson Harwood LLP concerned a recent English High Court case and the term “person discharging managerial responsibilities”. This, it was held, could not be beyond the “clear and unambiguous“3 definition set out in Schedule 10A to the Financial Services and Markets Act 2000. However, it is said that flexibility may, however, be found in the concept of de facto directorship: individuals who are found, on a detailed factual assessment, to have participated in decision making at a directorial level may be considered directors (and therefore a “person discharging managerial responsibilities”) for the purposes of the Act. The extent of this flexibility will be clarified at the next stage of proceedings.
FRENCH ANTI-CORRUPTION AGENCY’S 2021 ACTIVITY REPORT: METHODOLOGICAL WEAKNESSES CAUSE COMPLIANCE PROGRAM SHORTCOMINGS
On 6 June, an article from Jones Day reported that, despite the efforts made by companies to comply with the requirements of the Sapin 2 law, most anti-corruption programs in France remain qualitatively insufficient. This is the conclusion drawn in the light of the national regulatory authority’s 2021 activity report. It seems that, respect to many of the inspected companies, the authority was unconvinced of the effectiveness of the compliance measures they have put in place.
US CUSTOMS GUIDANCE TO IMPORTERS RE GOODS ALLEGED TO BE MADE FROM FORCED LABOUR IN THE XUAR REGION
On 6 June, an article from Crowell Moring points out that the Uyghur Forced Labor Prevention Act (UFLPA) goes into effect on 21 June, and that US Customs and Border Protection (CBP) has issued very minimal guidance to the importing community on how it will enforce the legislation. However, it has indicated that it will not employ a de mininis rule in enforcing the UFLPA – that is, all inputs used to produce an imported good, no matter of their tier/value/significance, must not have been made with forced labour. The article looks at what is known or in guidance to date.
SECOND SMUGGLING TUNNEL DISCOVERED UNDER KYRGYZ-UZBEK BORDER
On 7 June, Rferl reported that Kyrgyz officials say they have found a second tunnel along the Kyrgyz-Uzbek border purportedly used to illegally cross the border as well as for smuggling goods – the 155-meter-long tunnel was 1.8 meters high and just under 1 meter wide. 2 weeks ago, a 270-meter-long tunnel was found.
AUSTRALIA: AFP TO CRACKDOWN ON ORGANISED CRIME & MONEY LAUNDERING
On 6 June, Hit.com in Australia reported that Federal Police have announced plans to target Italian organised crime and money laundering syndicates operating in Australia. It is said that police have managed to locate a number of ‘Ndrangheta clans currently operating within Australia.
UK’S MOST WANTED WOMAN TO BE EXTRADITED FROM SPAIN OVER £1,000,000,000 VAT FRAUD
On 7 June, Metro reported that Sarah Panitzke, 48, had asked Spanish judges to reject an extradition application and demanded the right to be able to serve her sentence in Spain given her strong links to her ‘adopted homeland’. Her lawyers also said her husband, who also lives in Spain, has a life expectancy of just 10 years due to a liver transplant.
TROUBLE IN NFT PARADISE – LESSONS FOR BRAND OWNERS
On 6 June, an article from Bird & Bird examines 2 legal fights involving NFT that are currently ongoing before the US courts which touch on brand-related issues and distil from them some takeaways for brand owners.
UK: CURBS ON CIVIL LEGAL AID FOR TERRORISTS QUESTIONED BY MPs
On 7 June, the Law Society Gazette reported that plans to restrict terrorists’ access to civil legal aid have been described as illogical by MPs, with a former Attorney General saying he is ‘frankly worried’ by the proposals. A new Bill will prevent individuals convicted of a terrorist offence after February 2001 from obtaining civil legal aid for up to 30 years, though they can apply to the Legal Aid Agency for an ‘exceptional case determination’.
THE FUTURE OF OPEN-SOURCE INTELLIGENCE FOR UK NATIONAL SECURITY
On 7 June, an Occasional Paper from RUSI and the Alan Turing Institute’s Centre for Emerging Technology and Security explores the use of publicly available information and open-source intelligence for national security purposes, and provides recommendations for future policy development. The findings are based on in-depth consultations with stakeholders from across academia, civil society, commercial organisations, law enforcement and the UK government.
RUSSIAN SANCTIONS: FROM FREEZE TO SEIZE – CREATIVITY AND NUANCE IS NEEDED
On 7 June, a Commentary from RUSI says that political rhetoric on sanctioned Russian asset seizure is being replaced by concrete proposals. It says that the US, Canada and the EU all bringing forward proposals that are semantically different, but share the same goal: seizing Russia-related assets within the rule of law.
US: OFFICERS SEIZE PARCEL CONTAINING COUNTERFEIT DESIGNER WATCHES THAT, IF REAL, WOULD HAVE HAD A MANUFACTURER’S RETAILED PRICE (MSRP) OVER $22.5 MILLION
On 6 June, a news release from US Customs and Border Protection advised that the 584 counterfeit watches bore 2 trademarked logos: Rolex and Cartier. The shipment was arriving from an individual in Hong Kong and was destined for a resident in Jamaica, New York.
ARRESTS IN POLAND AND CANARY ISLANDS OVER €34 MILLION VAT FRAUD
A news release from Europol on 7 June advised that Polish Police Central Bureau of Investigation, with the support of the Spanish Civil Guard (Guardia Civil) and Europol, has unravelled a sophisticated tax evasion scheme which caused over €34 million in tax loss to the Polish state budget. A total of 10 individuals were arrested for their involvement in a VAT fraud scheme. Police raids were carried out simultaneously in Spain and Poland. 7 Eastern European fugitives were arrested in the Canary Islands and 3 additional members of this gang were arrested in Poland in the region of Śląsk and nearby the city of Łódź. Law enforcement also seized more than €8 million in cash and goods, including real estate and luxury vehicles.
On 6 June, Insight Crime reported that a series of arrests have highlighted how Chinese organised crime maintains a strong influence in Argentina’s capital, where merchants often must pay tens of thousands of dollars in extortion fees. In May, a string of police raids in Buenos Aires’ eastern neighbourhood of La Boca dismantled another Chinese mafia extortion ring. It says that police efforts to dismantle powerful factions within the organisation have been consistently stymied by language barriers, resistance from within local Chinese communities and official collusion.
MONACO-BASED YACHT SERVICES COMPANY SANCTIONED BY US
On 6 June, Insurance Marine news reported that the US Treasury has sanctioned Monaco-based Imperial Yachts for its alleged links to the Russian elite. Imperial Yachts provides a full portfolio of services, from design and ordering to chartering and ship management, and maintains a Moscow office. The US said that it was a popular choice of Russia’s yacht-owning elite. The US Treasury has listed Imperial Yachts and its CEO, Russian national Evgeniy Borisovich Kockman.
UK HOME OFFICE CANCELS BORDER FORCE CONTRACT WITH P&O FERRIES
On 6 June, Insurance Marine News reported that the Home Office has cancelled its Border Force contract with P&O Ferries after the mass sackings earlier this year. Border Force has terminated its agreement with P&O to provide contingency travel services.
GREEK SHIPPING COMPANIES ARE PROFITING BY MASKING THE TRANSPORT OF RUSSIAN OIL
On 5 June, Yahoo News reported that analysis seems to show that Greek shipping companies are engaging in “ship-to-ship” switches to disguise the transport of Russian oil. The data suggested “ship-to-ship” transfers in the Russian port of Kavkaz, where a Russian ship will unload oil from its vessel onto another vessel coming from a neutral company, has been on the increase since Russia invaded Ukraine in February. Analysis also showed Greek ports had become a hotspot, with transfers in the port of Kalamata rising by 20% in a month.
NEW ANALYSIS FINDS CONSUMERS REPORTED LOSING MORE THAN $1 BILLION IN CRYPTOCURRENCY TO SCAMS SINCE 2021
A news release from the US Federal Trade Commission on 3 June reports on new analysis from the FTC. Fraud reports suggest cryptocurrency is quickly becoming the payment of choice for many scammers, with about 1 out of every 4 dollars reported lost to fraud paid in cryptocurrency. It says that scams often falsely promise potential investors that they can earn huge returns by investing in their cryptocurrency schemes, but people report losing all the money they “invest”.
SOUTH FLORIDA ELECTRONICS EXPORTER PLEADS GUILTY TO LAUNDERING NARCOTICS PROCEEDS THROUGH THE BLACK MARKET PESO EXCHANGE
A news release from US DoJ on 7 June advised that MARCELO IRIGOIN had pleaded guilty to money laundering in connection with transactions involving his electronics export company. He moved over $1.4 million in narcotics proceeds through the Black Market Peso Exchange, a sophisticated market in which narcotics proceeds are bought and sold by money-launderers and then transferred overseas through shell companies and mirrored transactions.
US SANCTIONS CURB CHINESE TECHNOLOGY EXPORTS TO RUSSIA
A post on Lawfare on 3 June reported that major Chinese technology companies have quietly exited Russia in the face of US sanctions threats, despite the promise of a “no limits” relationship with Russia. However, Chinese technology companies have faced pressure from the Chinese public and government to stay in Russia – but that the threat of sanctions has had a pronounced effect on Chinese technology exports to Russia, whose consumer economy is highly dependent on Chinese technology.