Torrential rain nearly all day today, as a tropical wave passes by. Unfortunately, today was the all-day open house, with free entrance for locals, at the site of Panama’s original city, burned down following an attack by the pirate Henry Morgan, which is celebrating its 503rd birthday. Luckily we went to the “party” there yesterday, when it was a lovely day…
15 August 2022
NEW FINTRAC GUIDANCE CLARIFIES CHANGES TO CANADA’S AML REGIME
On 11 August, an article from DLA Piper said that, in April, the Canadian Department of Finance published amendments to regulations which target crowdfunding platforms as well as certain payment service providers that were not previously regulated and makes these entities subject to existing requirements for money services businesses (MSB). It says that the amendments significantly expand the Canadian AML regime and the entities that are now subject to it. It will be a major undertaking for those engaged in the payments industry to bring themselves into compliance.
IRELAND: DIRECTORS’ DUTIES: NEW STATUTORY DUTIES TO HAVE REGARD TO THE INTERESTS OF CREDITORS
On 11 August, an article from Arthur Cox LLP said that the European Union (Preventive Restructuring) Regulations 2022 have amended the Companies Act 2014 so as to require for the first time in Irish statute law directors of companies unable, or likely to be unable, to pay their debts, must have regard to the interests of creditors. It says that the importance of this amendment should not be understated.
INDONESIA’S RISING APPETITE FOR ONLINE INVESTMENT ATTRACTS SCAMS
On 15 August, an article from Nikkei Asia reported that the arrest of an internet “star” is just one of dozens that Indonesian police have made in recent months as they crack down on scams involving online trading and investment platforms. Such portals have surged in popularity in recent years in the largest economy in ASEAN, owing to a growing middle class with an appetite for investing. More than 3,000 have been shut down as scams.
US APPEALS COURT UPHOLDS OVERTURNING OF FORMER ALSTOM EXECUTIVE’S FOREIGN BRIBERY CONVICTION
On 12 August, the Wall Street Journal reported that an appeals court has upheld a decision by a lower court to overturn the foreign bribery conviction of a former Alstom executive, Lawrence Hoskins, whose alleged role in an Indonesian bribery scheme was the focus of a nearly decadelong prosecution. At issue throughout the government’s case was whether the executive, a British citizen who worked for the French company in Paris, fell under the jurisdiction of US anti-bribery laws. The latest ruling is likely to put more defined limits on which types of individuals — specifically foreign nationals — the US Government can charge with violating the Foreign Corrupt Practices Act (FCPA).
THE “FOREIGN POLICIES” OF THE SINALOA CARTEL AND CARTEL JALISCO NUEVA GENERACIÓN (CJNG) – THE ASIA-PACIFIC
On 5 August, an Op Ed from the Brookings Institution argues that the 2 cartels are in increasing competition around the globe. The older, innovative Sinaloa Cartel has had much more established external relations and pioneered expansion into Asia-Pacific. But CJNG is aggressively following suite. It warns that the Sinaloa Cartel’s and CJNG’s expansion into the Asia-Pacific meth markets puts them into direct competition with the Chinese triads, transforming a collaborative relationship into a confrontational stance. It also says that the big question is when the Mexican cartels will start pushing lethal fentanyl and synthetic opioids in Asia-Pacific.
BELARUS FINDS NEW RAIL ROUTES TO EXPORT GOODS AMIDST SANCTIONS
On 15 August, rail Freight reported that Belarusian Railways is said to have developed a total of 40 new export routes to more than 20 countries, now that sanctions have cut off its traditional routes to the global market.
ISRAEL ARRESTS 3 IN INTERNATIONAL MONEY LAUNDERING PROBE
On 15 August, Swissinfo reported that Israeli authorities have said that they had arrested 3 suspects as part of an investigation into “large-scale fraud” against the French treasury and the theft and laundering of millions of euros with cryptocurrencies.
MALAYSIA EX-PM BEGINS FINAL BID TO QUASH CORRUPTION CONVICTION
On 15 August, Al Jazeera reported that Malaysian former Prime Minister Najib Razak, 69, is to start his final attempt to set aside a corruption conviction linked to the multi-billion dollar 1MDB financial scandal. Prosecutors say more than $1bn in 1MDB funds made its way into Najib’s personal accounts.
CJEU GIVES A WIDE DEFINITION OF WHAT CONSTITUTES PROCESSING OF SENSITIVE PERSONAL DATA
On 15 August, an article from Bird & Bird said that the Court of Justice of the EU had handed down a decision on the scope of Article 9 GDPR – Article 9 defines what constitutes “special categories of personal data”. The categories affected are also referred to as sensitive personal data. In the judgement the CJEU interpreted “data concerning a natural person’s sex life or sexual orientation” very widely, but also raised a few other interesting points. The judgement is in line with previous rulings by the Court to interpret data protection definitions very wide.
RUSSIAN AND CHINESE INFLUENCE IN ITALY
On 15 August, an article from RUSI examines political, security, economic and cultural ties, to explore Russian and Chinese influence in Italy. It seeks to explore the dynamics between Italy and Russia, and Italy and China, through an examination of political, security, economic and cultural ties. It also attempts to understand the degree to which Italy’s policy positions are shaped by external influences or internal choices.
UK: LOAN FEE FRAUD – FCA WARNING
On 15 August, an article from Eversheds Sutherland was concerned with a warning from the FCA to consumers and advice on how to protect themselves. It explains that loan fee fraud is a type of advance fee scam, and arises where an individual or business wishes to take out a loan online; an upfront fee for the loan is sought by the organisation arranging the loan (i.e. the scammer); and once the fee is paid, the loan amount is never received.
UK: PROPOSED UPDATES TO THE SOURCEBOOK OF THE OFFICE FOR PROFESSIONAL BODY ANTI-MONEY LAUNDERING SUPERVISION (OPBAS)
On 11 August, a consultation paper from the FCA says that it is consulting on updating the Sourcebook to drive improvements in how professional body supervisors (PBS) reduce money laundering in the sectors they oversee. The consultation closes on 29 September.
FORMER CANADIAN MONEYGRAM AND WESTERN UNION AGENT PLEADS GUILTY TO FRAUD AND MONEY LAUNDERING CONSPIRACY CHARGE
On 12 August, a news release from US DoJ advised that William Nneji, age 55, of Canada and Nigeria, had pleaded guilty to conspiracy to commit mail fraud, wire fraud, and money laundering. He is said to have conspired with his co-defendant brother, Chima Nneji, co-defendant Alex Mgbolu, and other unnamed individuals between July 2002 and May 2010, to commit mail fraud, wire fraud, and money laundering by receiving money transfers from victims of international mass marketing fraud, processing those transfers using fictitious names, pooling the proceeds of those fraud induced money transfers, and then laundering those proceeds to co-conspirators in the US and Nigeria.
NEW YORK’S ANTIQUITY TRAFFICKING UNIT IS LOOKING TO ARREST A FORMER SOURCE TURNED SUSPECT
On 10 August, the New York Observer reported that Lebanese art collector Georges Lotfi provided information regarding looted artwork to the Antiquities Trafficking Unit (ATU) of New York’s District Attorney Office. However, Lotfi has now been brought to the forefront of an ATU investigation himself, with an arrest warrant charging him for criminal possession of stolen property.
SOUTH AFRICAN RESERVE BANK IMPOSES ADMINISTRATIVE SANCTIONS ON NEDBANK LIMITED
On 12 August, the Bank reported that SARB has imposed administrative sanctions on Nedbank Limited (Nedbank) and directed the bank to take remedial action following an inspection conducted in 2019. It says that Nedbank failed to comply with its Risk Management and Compliance Programme obligations.
EY AND KPMG IN THE US CHEATING SCANDALS EXPOSE ETHICAL CHALLENGES FOR AUDIT INDUSTRY
On 15 August, a post on the FCPA Blog considers the cheating scandals affecting CPA ethics examinations in the US, EY has become the latest example of how industry and company-level mindsets can turn into corporate liabilities and faces a fine of $100 million from the SEC, making it clear in their enforcement action that it was punishing both the cheating and the firm leadership’s failure to serve as a gatekeeper. However, it says, that this case with EY is not isolated.
UNDERSTANDING AND MITIGATING THE INFLUENCE OF THE ISLAMIC STATE IN MALAYSIA
On 15 August, a report from CTC Sentinel traces the evolution of the Islamic State’s influence in Malaysia between January 2014 and December 2019, shedding light on the various local and international factors that facilitated the rise of the Islamic State’s influence in the country. In addition to considering underlying historical and current socio-political factors, the report draws on original data on Islamic State-affiliated arrests and plots to uncover new insights about the men and women who were arrested due to their involvement with the Islamic State’s brand of militancy in Malaysia. Overall, the findings of this report suggest that one of the most dangerous characteristics associated with the Islamic State’s influence in Malaysia is its potential to radicalise and mobilise both men and women inspired by its extreme ideology without the existence of a formal Islamic State affiliate.
OFSI SANCTIONS REPORTING OBLIGATIONS WEBINAR FOR CRYPTOASSET BUSINESSES THAT NEED TO COMPLY WITH UK SANCTIONS.
On 15 August, OFSI in the UK uploaded to You Tube a webinar covering reporting obligations following amendments made by recent regulations which have widened the definition of a “relevant firm” to include crypto-asset exchange providers and custodian wallet providers.
JMLSG PUBLISHES REVISIONS TO MOTOR FINANCE MONEY LAUNDERING GUIDANCE
Lex Blog reports that on 12 August, the Joint Money Laundering Steering Group in the UK updated the Finance and Leasing Association standard for the prevention of financial crime and terrorist financing in motor finance credit application processing, including what evidence of KYC identification and verification of this evidence is required to meet the standard.
THE 50% SANCTIONS RULE
EX-PRESIDENT MARTINELLI’S SONS TO BE RELEASED IN JANUARY
On 15 August, La Prensa Panama reported that the brothers Luis Enrique and Ricardo Alberto Martinelli Linares, sons of the former president of Panama, Ricardo Martinelli Berrocal, who were jailed in the US for money laundering, will be released on 25 January. They pleaded guilty to laundering $28 million from construction company Odebrecht paid in exchange for contracts with the Panamanian state. The money received by the brothers would have been intended to benefit “a close relative and senior official” of the Panamanian Government, they said.
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