OTHER THINGS YOU MAY HAVE MISSED – JUNE 11

Panama Covid-19 update – it has been reported that Panama has received, or is receiving, Paxlovid and Molnupiravir, treatments that reduce hospitalisations and complications of patients infected with Covid-19. Panama is said to be one of the first countries in the region to have access to these medicines; the first in Central America and second in Latin America.

At the same time, the health ministry advised that lethality due to Covid-19 remains at an average of 0.9%, which means that Panama remains one of the countries with the lowest lethality in the region.

Meanwhile, today’s statistics – 2,323 new cases and 3 new fatalities; 25,692 active cases, with 32 in ICU and 272 in other wards. The testing rate remains high at 19.5% positive.

11 JUNE 2022

GUPTA BROTHERS AWAIT EXTRADITION TO SOUTH AFRICA AFTER YEARS OF REFUGE IN THE UAE

On 11 June, the Egypt Independent reported on the 2 brothers and their alleged involvement in a massive corruption scheme, saying that they are awaiting extradition after being arrested in the UAE where they are believed to have sought refuge since 2018.  South Africa ratified extradition treaties with the UAE in June last year.  It points out that the arrest of the Guptas is the second high-profile arrest related to alleged financial corruption within a week by the UAE, after the apprehension of hedge fund trader Sanjay Shah.  He is wanted on fraud and money laundering charges in Denmark, although he maintains his innocence.

https://www.egyptindependent.com/gupta-brothers-await-extradition-to-south-africa-after-years-of-refuge-in-the-uae-2/

THE EU AI ACT ASPIRES TO ESTABLISH THE FIRST COMPREHENSIVE REGULATORY SCHEME FOR ARTIFICIAL INTELLIGENCE, BUT ITS IMPACT WILL NOT STOP AT THE EU BORDERS

A report from the Brookings Institution on 8 June says that some EU policymakers believe it is a critical goal of the Act to set a worldwide standard, so much so that some refer to a race to regulate AI, to do so will have broad global impact to the benefit of the EU — often referred to as the “Brussels Effect”.  The report says that analysis suggests more limited global impact from the Act than is presented by EU policymakers. While it will contribute to the EU’s already significant global influence over some online platforms, it may otherwise only moderately shape international regulation.  Considering this, it says that the EU should focus on a more collaborative approach in order to bring other governments along with its perspective on AI governance.

https://www.brookings.edu/research/the-eu-ai-act-will-have-global-impact-but-a-limited-brussels-effect

IT BUGS HAUNT WORK OF EU FRAUD BUSTERS

On 9 June, EU Observer reported that EU efforts to fight fraud have been hampered by bugs and delays in an €29 million IT system meant to help manage investigations more efficiently – the OLAF case management system (OCM) installed in 2016.  Following years of problems, it is meant to go fully live in July — 6 years later.  The article says that there is now a recommendation that the agency’s director-general should carry out a “detailed cost-based analysis” of whether his agency should stick to OCM or switch to another system altogether.

https://euobserver.com/digital/155171

STOPPING THE PHOENIX FROM RISING: AUSTRALIAN COURT PROVIDES FIRST GUIDANCE ON CREDITOR-DEFEATING DISPOSITIONS

On 10 June, an article from Jones Day reported on a recent court case which involved a change in the law which expanded the kinds of transactions that may be voidable if a company is being wound up to include asset disposals undertaken as part of illegal “phoenix” schemes.  Such disposals are termed as “creditor-defeating dispositions” in the legislation.  This is said to be the first time a court has applied the creditor-defeating disposition provisions.  The Court declared the sale agreement void and has asked the parties to provide proposed orders for unwinding the transactions.

https://www.jdsupra.com/legalnews/stopping-the-phoenix-from-rising-4901097/

UK: HM TREASURY CONSULTATION INTO PROPOSED INSOLVENCY REGIME TO MANAGE FAILURE OF STABLECOIN FIRMS

On 10 June, an article from Cadwalader Wickersham & Taft LLP reported that HM Treasury launched a consultation on 31 May into the government’s proposals to manage the failure of systemic digital settlement asset (DSA), including stablecoin firms, by adapting the existing Financial Market Infrastructure Special Administration Regime.  Submissions must be made by 2 August.

https://www.jdsupra.com/legalnews/uk-treasury-opens-consultation-into-5581134/

IRAQI BANKS MISAPPROPRIATED $700 MILLION IN PUBLIC FUNDS

On 10 June, OCCRP reported that, along with dozens of their customers, 2 government-owned banks in Iraq have embezzled nearly $700 million in public funds, which has caused chaos in the banking system.  Authorities found that 40 people, including bank employees as well as bank customers, had been involved in “forgery, embezzlement, manipulation, money laundering, abuse of power, manipulation,” which took place at 5 different branches of 2 state-run banks: the Agricultural Cooperative Bank and Rasheed Bank.  It involved customers issuing cheques from an account with an insufficient balance.  The receiver of the cheque would get “special clearance” over the phone to deposit the cheque by saying the “secret number” which would support the fake balance in the issuer’s account, in order to allow for the withdrawal of funds.

https://www.occrp.org/en/daily/16423-iraqi-banks-misappropriated-700-million-in-public-funds

BOLIVIAN EX-PRESIDENT JEANINE ÁÑEZ JAILED AS LEADER OF ‘COUP’

On 11 June, the Guardian reported that a Bolivian court has found former president Jeanine Áñez, 54, guilty of orchestrating a coup that brought her to power during a 2019 political crisis.  She was sentenced to 10 years in prison.  She was convicted of making “decisions contrary to the constitution” and of “dereliction of duty”.

https://www.theguardian.com/world/2022/jun/11/bolivian-ex-president-jeanine-anez-jailed-as-leader-of-coup

UK: FOREST RISK COMMODITIES CONSULTATION OUTCOME PUBLISHED

On 10 June, CMS Law reported that DEFRA recently published the outcome of a consultation on the implementation of due diligence provisions aimed at tackling deforestation in UK supply chains.  The proposals will be brought forward with regulations expected to be passed in 2023. The article outlines the key elements of the government response.

https://www.cms-lawnow.com/ealerts/2022/06/forest-risk-commodities-consultation-outcome-published

ENGLISH HIGH COURT TREATS NFT AS LEGAL PROPERTY IN FRAUD CASE

On 10 June, an article from CMS Law said that, in an important ruling, the High Court recognised that there was at least a realistically arguable case that non-fungible tokens were to be treated as legal property for the purposes of granting an injunction against persons unknown and a Bankers Trust Disclosure Order against Ozone Networks Inc, trading as OpenSea.

https://www.cms-lawnow.com/ealerts/2022/06/english-high-court-treats-non-fungible-tokens-as-legal-property-in-fraud-case

US: SYNTHETIC OPIOIDS ARE AN EVERYTHING PROBLEM

On 9 June, a post from the RAND Corporation says that potent and dangerous synthetic opioids affect a wide range of policy areas and require a comprehensive response; and that it is time to meet this everything problem where it is: everywhere. In recent years, the numbers of overdoses from illegally manufactured synthetic opioids has jumped.  Between June 2020 and May 2021, more than 100,000 Americans died from a drug overdose – and this is more than twice the number of deaths from motor vehicle accidents or gun violence in that same period.  About two-thirds of those fatal overdoses involved illegally produced synthetic opioids. The main culprit is fentanyl, which is easy to produce, highly potent, and — when used outside of health care settings — potentially deadly.

https://www.rand.org/blog/articles/2022/06/synthetic-opioids-are-an-everything-problem.html

US SECURITIES REGULATOR OPENS PROBE INTO ERICSSON’S CONDUCT IN IRAQ

On 9 June, ICIJ reported that the Swedish company is now under investigation by the SEC, as well as the DoJ, on matters described in a 2019 internal Iraq bribery report that was leaked to ICIJ.

https://www.icij.org/investigations/ericsson-list/us-securities-regulator-opens-probe-into-ericssons-conduct-in-iraq/

KENYAN COMPANY FINED FOR ELABORATE TAX EVASION SCHEME ROUTED THROUGH MAURITIUS

On 9 June, ICIJ reported that the Kenya Revenue Authority found that a real estate company with ties to a Chinese construction giant, disguised more than $200 million using fake loans, fictional imports, phantom entities and more with the help of bankers and other enablers, according to a government audit.  In 2019, ICIJ revealed how the island nation had spent years attracting corporations with business in Africa that want to pay less tax to some of the poorest countries in the world.

https://www.icij.org/investigations/mauritius-leaks/kenyan-firm-fined-for-elaborate-tax-evasion-scheme-routed-through-mauritius/

UK: 70% OF ACCOUNTANTS HAVE MONEY LAUNDERING FEARS

On 9 June, Accountancy Today reported that a survey reveals only 45% are completely confident in their current AML procedures, while 76% believe the threat of money laundering will worsen over the next 3 years.  It also says that concerns about money laundering have risen by 70% among accountants since Russian events and sanctions began, and 75% of accountancy firms have made AML a priority in the past year. 

https://www.accountancytoday.co.uk/2022/06/09/70-of-accountants-have-money-laundering-fears-report-finds/

SINGAPORE: MAN TO BE JAILED FOR OBSTRUCTING NORTH KOREA SANCTIONS INVESTIGATION

On 8 June, NK News reported that Manfred Low Cheng Jin is to serve 15-week sentence for obstructing an investigation into oil transfers to a North Korean ship.

https://www.nknews.org/2022/06/singaporean-man-to-be-jailed-for-obstructing-north-korea-sanctions-investigation/

MURDER OF PARAGUAY PROSECUTOR MARCELO PECCI SHOWS INTERNATIONAL CRIME LINKS

On 9 June, El Pais in Spain carried an article saying that 5 people have been arrested for the murder on the resort island of Baru, and Colombian authorities say they are pursuing a sixth suspect.  It is said that there are indications that an international criminal network coordinated by the Brazilian gang First Capital Command (PCC) formulated the plan to kill Pecci.  It explains that Paraguay is a large marijuana producer and the most important route for moving cocaine to Europe, has therefore attracted a wide range of criminal organizations in recent years.  Pecci was the top prosecutor in charge of several of the country’s most important drug trafficking and money laundering cases, and one of his main targets was Brazil’s PCC.

https://english.elpais.com/international/2022-06-09/murder-of-paraguay-prosecutor-marcelo-pecci-shows-links-between-international-criminals.html

HOW GOODS MADE WITH FORCED LABOUR END UP IN YOUR LOCAL AMERICAN STORE

On 21 May, NPR in the US published an item based on a C4ADS report about goods with links to Xinjiang.

https://www.npr.org/2022/05/21/1100391863/uyghurs-xinjiang-muslim-minority-forced-labor-china

US: CONGRESS IS VOTING SOON TO OVERHAUL THE SHIPPING INDUSTRY – HERE’S EVERYTHING YOU NEED TO KNOW

On 10 June, American Shipper published an article saying that Congress will soon schedule a vote on the Ocean Shipping Reform Act of 2022 and, with bipartisan support in both the House and Senate, it is likely to pass.  It is described as the largest overhaul of shipping regulations since 1998.  It provides a summary of the provisions, their corresponding deadlines and why they matter.

https://www.freightwaves.com/news/ocean-shipping-reform-acts-critical-provisions-and-their-deadlinesnbsp

THE UK MUST LEGISLATE TO COMBAT MONEY LAUNDERING IN ITS UNIVERSITIES

On 10 June, a post on the Global Anticorruption Blog says that in 2021 reports revealed that nearly 50 UK universities had accepted upwards of £52 million in direct cash payments for tuition and fees from students hailing from countries known to be “high risk” for money laundering — most notably the West African countries of Ghana and Nigeria.  It recommends that the UK amends its AML legislation to address the particular vulnerabilities in the university sector, and says that there are 3 reforms which would be particularly prudent.  It argues that, because UK universities are not subject to the same AML rules as other sectors, they are especially vulnerable to kleptocrats and criminals seeking to offload their “unexplained wealth” and purchase an elite status for themselves and their children.

https://globalanticorruptionblog.com/2022/06/10/the-u-k-must-legislate-to-combat-money-laundering-in-its-universities/

DOZENS OF AMERICAN SWEET SHOPS ON OXFORD STREET UNDER INVESTIGATION OVER ALLEGED TAX SCAM

On 11 June, the Evening Standard reported that the shops are facing a council investigation for allegedly failing to pay full business rates.  30 US-themed sweet shops  – including in the once iconic HMV flagship site – are being investigated amid concern they have failed to account for £7.9 million in business rates.  It is said that the shops avoid paying full business rates by subletting the property from an intermediary firm, rather than the freeholder or long leaseholder, the council has claimed. The shops do not appear to be “commercially viable”, Westminster Council said in a statement, and that it believed that the properties were used to avoid business rate bills and possibly commit other offences. Some of the stores are reported to be charging unwitting customers up to £45 for packets of sweets.

https://www.standard.co.uk/news/london/london-news-american-candy-shops-oxford-street-council-tax-business-rates-b1005515.html

Any modest contributions for my time and ongoing expenses are welcomed!  I have a page where you can do so, and where one-off contributions start as low as $3, at

https://www.buymeacoffee.com/KoIvM842y

NOTE THAT THE ABOVE LINK IS NOW CORRECTED AND WORKS!

THE ILLICIT POSSESSION AND TRANSFER OF MANPADS: A GLOBAL ASSESSMENT

On 10 June, a post from the Small Arms Survey is concerned with the illicit proliferation of man-portable air defence systems (MANPADS).  It says that armed groups continue to acquire and use these weapons at an alarming rate, and the Small Arms Survey has identified reports of illicit MANPADS in 32 countries and territories on 5 continents since 2011. Soviet-designed first-generation SA-7 pattern MANPADS remain the most numerous and widely proliferated illicit MANPADS worldwide.  The most notable change in proliferation patterns since 2011 is the sharp rise in the number of cases of illicit possession of advanced Chinese-designed MANPADS.  The continued proliferation of MANPADS poses an acute threat to military and civilian aircraft.

https://smallarmssurvey.medium.com/the-illicit-possession-and-transfer-of-manpads-a-global-assessment-7e2e75ff5fe2

Any modest contributions for my time and ongoing expenses are welcomed!  I have a page where you can do so, and where one-off contributions start as low as $3, at

https://www.buymeacoffee.com/KoIvM842y

NOTE THAT THE ABOVE LINK IS NOW CORRECTED AND WORKS!