OTHER THINGS YOU MAY HAVE MISSED – JUNE 27

Panama Covid-19 update – are figures falling? Too early to say, with 866 cases and 1 new fatality reported today, and active cases falling by nearly 1,000 to 14,148. There are 35 patients in ICU, 195 in other wards and 12 in hospital-hotel quarantine.

27 JUNE 2022

ISLE OF MAN: AMENDMENT OF RUSSIAN AND MYANMAR SANCTIONS LISTS

On 27 June, 2 news releases advised that 59 entries on the Russia sanctions list had been amended or corrected, and that the entry for SINS AVIA TRADING HOUSE LLC on the Myanmar sanctions list had been amended.

https://www.gov.im/news/2022/jun/27/financial-sanctions-russia/

https://www.gov.im/news/2022/jun/27/financial-sanctions-myanmar/

UK: APP FRAUD – WHAT NEW CHANGES ARE ON THE HORIZON FOR BANKS?

On 24 June, an article from Tenet Compliance & Litigation Ltd is concerned with APP fraud, or authorised push payment fraud, which occurs when someone is tricked into sending money to a fraudster posing as a genuine payee.  On 18 November, the Payment Systems Regulator published a consultation paper on APP scams and focuses on 3 main proposals – the publication of fraud data by banks; improvements in scam prevention; and the mandatory reimbursement of victims.  It says that banks need to act now to be ready for the proposed changes.

https://tenetlaw.co.uk/articles/app-fraud-what-new-changes-are-on-the-horizon-for-banks/

PLANS TO ADDRESS AUDIT FAILURES IN THE UK RAISE CONCERNS

On 24 June, the Wall Street Journal reported that plans to tighten controls over audits and accounting in the UK may end up giving corporate insiders too much leniency to be effective, some regulators and academics say.  The plan would require directors from large listed companies to either comply with newly proposed audit rules or explain why they don’t – a “comply or explain” approach, a move that would be a step back from previous plans to hold directors personally liable for failed oversight of internal controls.  This proposed change is part of a broader strategy to overhaul audit and governance rules as the UK aims to bolster confidence in corporate accounting.  Introduced in 1992, the comply or explain principle already applies to other corporate matters.  The Financial Reporting Council has said it expects to issue guidance soon on how it plans to respond to the government’s proposal.

https://www.wsj.com/articles/plans-to-address-audit-failures-in-the-u-k-raise-concerns-11656063000

RUSSIA TO SPEND $14.5 BILLION TO BOOST LOCAL AIRCRAFT PRODUCTION AMID SANCTIONS

On 27 June, WHTC.com reported that the Russia’s government has announced plans to invest $14.5 billion in the country’s aviation industry by the end of this decade to boost the share of domestically-manufactured aircraft.  Russia has been pushing to localise aircraft production but only the Sukhoi Superjet regional aircraft is mass-produced inside Russia, while a significant number of its components, including vital engine parts, are imported.  Other types are to be produced and Aeroflot is set to order large numbers of domestic types.

https://whtc.com/2022/06/27/russia-to-spend-14-5-billion-to-boost-local-aircraft-production-amid-sanctions/

CANADA: BUDGET BILL GIVES CABINET NEW POWER TO REDISTRIBUTE SANCTIONED PROPERTY

On 27 June, CBC said that selling Russian-owned assets to pay for Ukraine’s reconstruction may sound like a logical approach to restitution, but as the Canadian government gains new powers to begin this process, questions remain about how it will work, and whether some issues are headed to court.

https://www.cbc.ca/news/politics/c19-russia-sanctions-asset-seizures-test-case-1.6496047

HONG KONG VASP REGIME TO TAKE EFFECT ON 1 MARCH 2023

On 26 June, Regulation Asia reported that amendments have been made to the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO) to enhance Hong Kong’s AML/CFT regulatory regime.  The long-awaited amendments include a new licensing regime for virtual asset service providers (VASP) to be administered by the Securities and Futures Commission (SFC).

https://www.regulationasia.com/hong-kong-vasp-regime-to-take-effect-on-1-march-2023/

https://www.fstb.gov.hk/fsb/en/legco/docs/AML(A)Bill%202022_legco%20brief_e%20(Issue).pdf

https://www.pinsentmasons.com/out-law/analysis/hong-kong-central-bank_s-risk-based-approach-to-crypto-assets-and-stablecoins

SWISS COURT CONVICTS CREDIT SUISSE IN MONEY LAUNDERING CASE

On 27 June, Investing.com reported that Switzerland’s Federal Criminal Court has convicted Credit Suisse and a former employee of failing to prevent money laundering in Switzerland’s first criminal trial of one of its major banks. The case related to an alleged Bulgarian cocaine trafficking gang laundering profits through the bank from 2004 to 2008.

https://uk.investing.com/news/stock-market-news/court-convicts-credit-suisse-in-moneylaundering-case-2676227

REGIONAL AML/CFT GROUP BEGINS ONSITE EVALUATION OF ANGOLA

On 27 June, Foreign Brief reported that FATF-style regional body ESAAMLG (the Eastern and Southern Africa Anti-Money Laundering Group) representatives have begun their onsite evaluation of Angola.  It warns that corruption puts it at risk of re-entering the FATF blacklist.

https://foreignbrief.com/daily-news/angola-anti-money-laundering/

UK: LAW FIRM FINED AFTER WRONGLY SAYING IT HAD PROPER AML RISK ASSESSMENT

On 27 June, the Law Society Gazette reported that the regulator SRA has continued its clampdown on firms not complying with AML regulations by fining a Midlands practice.  The firm reached a settlement with the regulator that it would pay a £2,000 fine and £1,350 costs after a number of shortcomings were identified.

https://www.lawgazette.co.uk/news/firm-fined-after-wrongly-saying-it-had-proper-aml-risk-assessment/5112926.article

CORPORATE CRIMINAL LIABILITY IN ENGLAND AND WALES 

On 27 June, the House of Commons Library published a briefing concerned with corporate criminal liability, explaining that corporates in themselves can’t think or act – it’s their members, employees or directors that do so.  But they generally are ‘legal persons’, so can commit crimes.  The briefing looks at calls for reform and the options.

https://researchbriefings.files.parliament.uk/documents/CBP-9027/CBP-9027.pdf

UK SANCTIONS GENERAL LICENCES

On 27 June, the UK issued an updated list of current General Licences which permit activity that would otherwise be prohibited.

https://www.gov.uk/government/collections/ofsi-general-licences

https://www.gov.uk/government/collections/expired-general-licences

UK SANCTIONS FOLLOWING RUSSIA’S INVASION OF UKRAINE

On 27 June, the Foreign Commonwealth and Development Office issued an updated summary of UK sanctions imposed on Russia.

https://www.gov.uk/government/collections/uk-sanctions-following-russias-invasion-of-ukraine

US: A CLOSER LOOK AT THE CHINA FORCED LABOR ENFORCEMENT STRATEGY

On 27 June, an article from Sandler Travis Rosenberg considered the Uyghur Forced Labor Prevention Act, which effectively bans imports of all goods mined, produced, or manufactured in China’s Xinjiang Uyghur Autonomous Region, and the Department of Homeland Security recently issued strategy for enforcing this prohibition. 

https://www.strtrade.com/trade-news-resources/str-trade-report/trade-report/june/a-closer-look-at-the-china-forced-labor-enforcement-strategy

HUNGARY ARRESTS FORMER POLICE OFFICER TURNED “BRAZILIAN ESCOBAR”

On 27 June, OCCRP reported that police in Hungary had detained Sergio Roberto de Carvalho, whose network is suspected to have shipped 45 tons of cocaine from Brazilian ports to Europe.  A total of 163 properties connected to Carvalho have been seized in Brazil, Portugal, Spain and Dubai over the years as well as 37 aircraft, 70 cars, and millions of euros.

https://www.occrp.org/en/daily/16486-hungary-arrests-former-police-officer-turned-brazilian-escobar

FORMER PARAMILITARY COMMANDER AND DRUG LORD “MEMO FANTASMA” MAY WALK OUT OF PRISON IN COLOMBIA 

On 27 June, Insight Crime reported that, if released, his high-level connections and millions in criminal assets could result in witnesses being threatened, or in Memo disappearing altogether.  Guillermo León Acevedo Giraldo is facing money laundering charges alongside his mother and grandmother, and is seeking his release after spending a year in prison on pre-trial detention.

https://insightcrime.org/investigations/memo-fantasma-out-prison-corruption-incompetence/

CONCERNS GROW THAT INDIA IS ‘BACK DOOR’ INTO EUROPE FOR RUSSIAN OIL

On 26 June, The Observer reported that before the war in Ukraine India’s imports of Russian oil were negligible due to high freight costs.  But recently, imports of Russian oil to India have increased.  It says that the volumes that India has been buying and exporting, however, suggest that some of the refined Russian crude may ultimately be used in Europe’s filling stations.  It says that there are several tactics shippers are using to hide the origin of Russian oil: paying in Chinese currency – rather than the industry standard dollar; transfers of oil cargoes from ship-to-ship have spiked; increasing numbers of vessels have been “going dark” by switching off their AIS; and trading oil directly for other products, such as gold, food or weapons.

https://www.theguardian.com/business/2022/jun/26/concerns-india-back-door-into-europe-for-russian-oil

THE EncroChat HACK WAS HAILED AS A MAJOR COUP BUT EUROPE IS STILL AWASH WITH DRUGS

On 23 June, Vice News carried an article saying that when police hacked into organised crime’s secret messaging network, it led to a wave of high-profile arrests and drug busts.  2 years on, analysis by VICE World News shows that it has failed to dent drug supply.

https://www.vice.com/en/article/88q9pz/encrochat-cocaine-europe

IRAN RANKS 22nd AMONG WORLD’S TOP SHIPPING FLEETS

On 27 June, Hellenic Shipping News reported that the UN Conference on Trade and Development (UNCTAD), in its latest maritime report, “Review of Maritime Transport 2021”, has put Iran in 22nd place among the countries with the largest shipping fleet based on deadweight tonnage.

https://www.hellenicshippingnews.com/iran-ranks-22nd-among-worlds-top-shipping-fleets-unctad/

COULD SANCTIONS AGAINST RUSSIA BACKFIRE?

On 20 June, an article from Refinitiv analyses how effective sanctions against Russia are likely to be, considering lessons from history, international unity and the ability of Russia to withstand the impacts.

https://www.refinitiv.com/perspectives/regulation-risk-compliance/could-sanctions-against-russia-backfire/

RECOVERED CORRUPTION MONEY PROVIDES ‘LIFE-SAVING SUPPORT’ TO 150,000 VULNERABLE PEOPLE

On 27 June a post on the FCPA Blog details how £4.4 million from 2 Chad diplomats who took bribes from Canadian oil company Griffiths Energy was transferred to Chad and used in aid and development programmes.  It explains how the money was used and asks if it made a difference?  It concludes that, with total FCPA penalties to date nearing $25 billion in the US, the results in Chad show that even a modest financial investment in a developing country can have a tremendous impact. 

https://fcpablog.com/2022/06/27/recovered-corruption-money-provides-life-saving-support-to-150000-vulnerable-people/

RUSSIAN OIL TANKERS GET INDIA CLASSIFICATION VIA DUBAI COMPANY

On 24 June, Insurance Marine News reported that the Indian Register of Shipping (IRClass) is providing safety certification for dozens of ships managed by a Dubai-based subsidiary Russian shipping group Sovcomflot.  This comes after western classification societies withdrew their guarantees after sanctions against Russia.  The Sovcomflot tanker fleet was finding it difficult to remain in operation in the immediate aftermath of the imposition of sanctions, with liability insurance and classification being withdrawn, and financial associations limited by sanctions against Russian banks.

https://insurancemarinenews.com/insurance-marine-news/russian-oil-tankers-get-india-classification-via-dubai-company/

EUROPEAN EXPORTERS WARY OF UK CUSTOMS CHANGE, WITH TRADERS STILL UNPREPARED

On 27 June, Loadstar reported that UK ports face a “shit show” from 1 October, if even a fraction of the traders not yet using the country’s new customs declaration system fail to migrate before the September deadline.  From then, UK imports will run through updated online system the Customs Declaration Service (CDS), as HMRC terminates support for the existing CHIEF platform – but many users have yet to make the switch.

https://theloadstar.com/european-exporters-wary-of-uk-customs-switch-with-traders-still-unprepared/

ECOFIN REPORT TO THE EUROPEAN COUNCIL ON TAX ISSUES

On 20 June, KPMG published an article about this report which covered a slew of tax-related issues, including the EU Code of Conduct Group on Business Taxation, harmful tax practices, preferential tax regimes, and the EU List of Non-Cooperative Jurisdictions.  The EU Code of Conduct Group on Business Taxation had a report accepted by the Council which included details of an update on the screening and listing exercise with regards to non-cooperative jurisdictions.  It also agreed to continue working on defensive measures against non-cooperative jurisdictions for tax purposes.

https://home.kpmg/xx/en/home/insights/2022/06/etf-478-ecofin-report-to-the-european-council-on-tax-issues.html

TAXATION OF THE DIGITALIZED ECONOMY

On 27 June, KPMG published the latest edition of this update, covering direct and indirect tax issues.

https://tax.kpmg.us/content/dam/tax/en/pdfs/2022/digitalized-economy-taxation-developments-summary.pdf

TOXIC GAS LEAK IN SEAPORT IN JORDAN LEAVES 13 DEAD AND HUNDREDS INJURED

On 27 June, the Guardian reported that 13 people have died and 251 have been injured in a toxic gas leak from a storage tank – a tank filled with 25 tonnes of chlorine – at Aqaba port.  A vessel had been waiting to load almost 20 containers of liquified gas “containing a very high percentage of chlorine”.

https://www.theguardian.com/world/2022/jun/27/jordan-toxic-gas-leak-aqaba-port

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THREAT ASSESSMENT: ENVIRONMENTAL CRIME IN THE AGE OF CLIMATE CHANGE

On 27 June, Europol published this Threat Assessment, saying that crimes against the environment threaten the survival of all living species and have an enormous financial impact, which is set to increase further. Opportunities for high profits, legal discrepancies among countries, low risk of detection and marginal penalties make environmental crime a very attractive business for criminal entrepreneurs.  It goes into depth on the main typologies of environmental crimes investigated in the EU, namely waste and pollution crimes, wildlife trafficking, illegal, unreported and unregulated fishing, forestry crimes and the illegal pet trade.  A special focus is paid to climate change, which functions as a push and pull factor for organised crime.  The increasing scarcity of natural resources will likely trigger organised crime interests in terms of profit over their future allocation.

https://www.europol.europa.eu/cms/sites/default/files/documents/Environmental_Crime_in_the_Age_of_Climate_Change_threat_assessment_2022.pdf

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https://www.buymeacoffee.com/KoIvM842y

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MONEYVAL CALLS ON BULGARIA TO IMPROVE USE OF FINANCIAL INTELLIGENCE, INVESTIGATION AND PROSECUTION

On 27 June, the Council of Europe body published the mutual evaluation report on Bulgaria following the onsite visit in September.  The report highlights various shortcomings, but concludes that although there are some technical and procedural constrains, Bulgaria provides generally timely and constructive assistance across the range of requests for international co-operation, including mutual legal assistance. On effectiveness, it is said that Bulgaria has achieved a low level of effectiveness in areas related to the use of financial intelligence, investigations and prosecutions of money laundering, confiscation of proceeds of crime or property of equivalent value, targeted financial sanctions related to proliferation financing and the prevention of misuse of legal persons and arrangements.

https://rm.coe.int/moneyval-2022-1-mer-bulgaria/1680a70913

https://search.coe.int/directorate_of_communications/Pages/result_details.aspx?ObjectId=0900001680a70353

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!