OTHER THINGS YOU MAY HAVE MISSED – SEPTEMBER 6

The latest statistics for Covid-19 to 3 September show that the percentage of positive tests has fallen to 8.2% (down from 12.% in the previous week), but with 3,641 new cases (5,366 the previous week) and 10 more fatalities (19 the previous week). There are now 5,234 active cases (7,431 in the previous week) – 14 in ICU and 101 in other wards.

Meanwhile, the health ministry has issued a set of 2 illustrations on prevention of monkeypox –

6 SEPTEMBER 2022 

HMRC KEEPS UP INVESTIGATIONS INTO TAX EVASION IN LABOUR SUPPLY CHAINS AND UMBRELLA COMPANIES

On 4 September, Osborne Clarke warned that there are signs HMRC is now more aggressive in their pursuit and that a civil investigation with 20-years’ tax exposure and penalties of up to 200% can still be a business-critical event.  It highlights IR35, agency-worker tax rules, offshore employer’s rules and managed-service-company as areas of concern.  It warns that if umbrella companies or overseas payroll partners are involved in tax evasion, the end users and staffing companies that use them may face prosecution and unlimited fines unless they have in place reasonable steps and procedures to prevent the facilitation of tax evasion.

https://www.mondaq.com/uk/tax-authorities/1222118/hmrc-keeps-up-investigations-into-tax-evasion-in-labour-supply-chains

AUSTRALIA: AUSTRAC HAS ESTABLISHED AN INTELLIGENCE UNIT DEDICATED TO MONITORING COMPLIANCE WITH RUSSIAN SANCTIONS, SIGNALLING A SHARPER REGULATORY FOCUS ON SANCTIONS LAWS

On 5 September, Corr Chambers Westgarth advised that, given increased regulatory focus, businesses need to take steps to ensure they comply with sanctions, with a particularly cautious approach when dealing with individuals or entities based in Russia or the sanctioned region of Ukraine.  The article also looks at the steps Australia has taken re Russian sanctions to date.

https://www.mondaq.com/australia/export-controls-trade-investment-sanctions/1227304/austrac-announcement-shows-heightened-focus-on-sanctions-compliance

US: 2 NEW RULES REINFORCE INCREASED SCRUTINY FOR CHINESE-ORIGIN SUPPLY CHAINS

On 1 September, an article from Sheppard Mullin reported on new changes by the Department of Defense to the Defense Federal Acquisition Regulation Supplement (DFARS) reinforcing national defence priorities that limit DoD contracts performed in China, and the DoD’s ability to acquire tantalum metals from China and other unfriendly countries such as a Iran, North Korea, and Russia.  These rules continue a trend of isolating countries in US supply chains that are deemed a potential national security threat.  One rule involves employment of people working in China on a contract or subcontract basis; and the other adds tantalum metals and alloys to the list of “covered materials” that are prohibited from being acquired from unfriendly countries such as China, Iran, North Korea, and Russia.

https://www.mondaq.com/unitedstates/government-contracts-procurement-ppp/1226320/in-the-interest-of-national-security-two-new-dfars-rules-reinforce-increased-scrutiny-for-chinese-origin-supply-chains

US: STRICT TERMS & CONDITIONS FOR REPATRIATED LOOTED ABACHA FUNDS TO NIGERIA

On 2 September, an article from Songhai Advisory LLP examined the strict conditions for repatriation to ensure that the returned funds go to where they’re needed most, as the US agreed to repatriate to Nigeria $23 million that had been recovered as proceeds of corruption by former Head of State, Sani Abacha.

https://www.mondaq.com/unitedstates/white-collar-crime-anti-corruption-fraud/1227066/give-unto-caesar-terms-conditions-for-repatriated-looted-funds-to-africa

PANAMA: 11 ARRESTED FOR ALLEGED LINK TO FINANCIAL CRIMES INVOLVING PHISHING AND SIM-SWAPPING

On 6 September, Newsroom Panama reported that cash, computers, cell phones, sim cards, a money counting machine, and other evidence have been seized.

https://www.newsroompanama.com/news/at-least-11-arrests-in-phishing-scam

https://www.telemetro.com/nacionales/sim-swapping-o-duplicacion-tarjeta-sim-nueva-tecnica-estafa-y-fraude-panama-n5765350

CROATIA TO ADOPT THE EURO FROM 1 JANUARY: THE FINAL TRANSITION 

On 5 September, an article from CMS Law advised that there is an obligation to report prices in both kuna and euro in Q4 of 2022, with dual reporting using the fixed conversion rate of 7.53450 kuna for 1 euro from 5 September 2022, and this will continue throughout the whole of 2023.  Other transitional measures are also mentioned.

https://www.cms-lawnow.com/ealerts/2022/09/croatia-to-adopt-the-euro-from-1-january-2023-final-transition-in-q4-2022?cc_lang=en

UK: TRAFFICKING GANG LAUNDERED MILLIONS THROUGH VIETNAMESE STUDENT ACCOUNTS AND NAIL BARS

On 6 September, ITV News reported that 5 members of a human trafficking gang which laundered £4 million through student bank accounts and nail bars have been sentenced.  They used Vietnamese students at a British university to receive millions of pounds of cash directly into their bank accounts.  This money was then transferred to other Vietnamese nationals in the UK who were running businesses exporting clothes to Vietnam.

https://www.itv.com/news/anglia/2022-09-05/international-gang-laundered-millions-through-nail-bars-and-students

ONE OF THE UK’S MOST WANTED CRIMINALS EXTRADITED FROM SPAIN TO FACE MONEY LAUNDERING CHARGES

On 5 September, Murcia Today reported that Michael Morgan Foster, 25, was to be extradited to the UK after being arrested by Spanish police in June.  He had been on the run since 2020.

https://murciatoday.com/money-laundering-briton-extradited-from-murcia-to-the-uk_1828197-a.html?

SFO HEAD OSOFSKY CALLS FOR REFORM OF DISCLOSURE RULES

On 6 September, the Law Society gazette reported that the director of the Serious Fraud Office has called for reform of disclosure rules to ‘rebalance the system for victims and justice’ following a series of high-profile errors by the SFO.  She suggested that the current disclosure regime – which was ‘designed before the advent of mass digital data … when there was far less material for investigators and prosecutors to deal with’ – is out of date.

https://www.lawgazette.co.uk/news/osofsky-calls-for-reform-of-disclosure-rules/5113590.article

‘FAT LEONARD’, CONTRACTOR IN US NAVY’S WORST CORRUPTION SCANDAL, FLEES HOUSE ARREST

On 6 September, the Guardian reported that a Malaysian businessman who pleaded guilty in the US Navy’s worst corruption scandal has escaped house arrest in San Diego after cutting off his monitoring bracelet.  Leonard Glenn Francis, known as Fat Leonard, who ran a military contracting company in Singapore, was convicted in 2015.

https://www.theguardian.com/us-news/2022/sep/06/fat-leonard-contractor-in-us-navys-worst-corruption-scandal-flees-house-arrest

RUSSIA BUYING MILLIONS OF ROCKETS AND SHELLS FROM NORTH KOREA, US INTELLIGENCE SAYS

On 6 September, the Guardian reported that Russia is buying millions of rockets and artillery shells from North Korea to support its invasion of Ukraine as the Russian military continues to suffer from severe supply shortages.

https://www.theguardian.com/world/2022/sep/06/russia-buying-millions-rockets-shells-north-korea-us-intelligence-ukraine

MALAYSIA: IMPRISONED EX-PM NAJIB RAZAK PETITIONS FOR ROYAL PARDON

On 6 September, Eurasia Review reported that disgraced former Prime Minister Najib Razak, who was sent to prison for 12 years for corruption in a 1MDB-related case, has petitioned the king for a pardon. 

https://www.eurasiareview.com/06092022-malaysia-imprisoned-ex-pm-najib-razak-petitions-for-royal-pardon/

UK: THURROCK COUNCIL – GOVERNMENT ANNOUNCED IT IS SENDING IN INSPECTORS FOLLOWING AN INVESTMENT SCANDAL

On 2 September, the Bureau of Investigative Journalists provided an update on the case after, in July, its 3-year investigation revealed that at least £138 million of public money was unaccounted for following deals between the Conservative-run council and a businessman.

https://www.thebureauinvestigates.com/stories/2022-09-02/government-steps-in-to-inspect-grave-concerns-over-council-finances

EXTRADITION OF 2 DEFENDANTS CHARGED WITH BRIBING HIGH-LEVEL OFFICIALS OF THE REPUBLIC OF THE MARSHALL ISLANDS

A US DoJ news release on 2 September advised about an unsealed indictment charging 2 persons with engaging in a multi-year scheme to bribe government officials in the Republic of the Marshall Islands to pass certain legislation that would benefit business interests.  They were arrested in Thailand in November 2020, and have been extradited to the US.

https://www.justice.gov/usao-sdny/pr/us-attorney-announces-extradition-two-defendants-charged-bribing-high-level-officials

AUSTRALIAN BITCOIN MOGUL PLEADS GUILTY TO US CHARGE OVER BitMEX

On 6 September, The Age reported that Australian bitcoin mogul Greg Dwyer has pleaded guilty to one charge of violating American banking laws after he confessed to failing to put in an AML program at global cryptocurrency platform BitMEX.

https://www.theage.com.au/business/markets/aussie-bitcoin-mogul-pleads-guilty-to-us-charge-over-bitmex-20220906-p5bfqa.html

QATAR’S FATF EVALUATION TO BE PUBLISHED IN FEBRUARY

On 6 September, The Peninsula reported that the mutual evaluation and assessment on Qatar by FATF has been completed and the report is expected to be published in February 2023. 

http://thepeninsulaqatar.com/article/06/09/2022/qatars-fatf-evaluation-to-be-published-in-feb

https://www.linkedin.com/posts/baptisteforestierlinkcy_bankingindustry-money-moneylaundering-activity-6972807858430083072-lQCP 

MALTA: FIAU FINES GAMING OPERATOR €130,000 OVER AML SHORTCOMINGS

On 6 September, the Times of Malta reported that Olimp Limited received the fine following a 2020 inspection by the Financial Intelligence Analysis Unit.  The company, which has since surrendered its gaming licence, is owned by Russian national Galina Reed, together with a holding company which is, in turn, owned by Reed and another holding company based in Cyprus, Anarbek Holding Ltd. 

https://timesofmalta.com/articles/view/fiau-fines-gaming-firm-130-000-anti-money-laundering-shortcomings.979100

BRAZILIAN SEC IS LOOKING TO CHANGE CRYPTO REGULATION WITH NEW BILL

On 6 September, Oodaloop reported that it appeared that the Brazilian Securities and Exchange Commission is looking to switch up the country’s legal framework for cryptocurrencies. 

https://www.oodaloop.com/technology/2022/09/06/brazilian-sec-is-looking-to-change-crypto-regulation-with-new-bill/

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UK: RUSSIA SANCTIONS – 1 ENTRY CORRECTED AND 1 AMENDED

A Notice from HM Treasury on 6 September advised that the entry relating to Mikhail RAZVOZHAEV had been amended and that for Pavel EZOUBOV had been corrected.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1102873/Notice_Russia_060922.pdf

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RAIDS REVEAL HOW ILLEGAL GOLD FROM INDIGENOUS LANDS GETS LAUNDERED IN BRAZIL

On 29 August, a report from Mongabay says that raids on mining company Gana Gold have revealed how gold mined illegally in Indigenous territories and other protected areas in the Brazilian Amazon makes its way into the legitimate trade.  The raids also uncovered strong links between drug traffickers and illegal miners, who were found to use the same trafficking routes to get their respective illicit commodities out of the forest and into the rest of the world.  It is said that, given that the vast majority of Brazilian gold is exported, there’s an onus on overseas buyers to establish chain of custody controls to ensure they’re not buying illegally mined gold.

https://news.mongabay.com/2022/08/raids-reveal-how-illegal-gold-from-indigenous-lands-gets-laundered-in-brazil/

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HUMAN TRAFFICKING: US AGENCIES’ INTERNATIONAL EFFORTS TO FIGHT A GLOBAL PROBLEM

On 1 September, the Government Accountability Office published a Snapshot report saying that the US seeks to combat trafficking.  For example, the Departments of State, Labor, Homeland Security, and Defense, and the US Agency for International Development have programmes to prevent trafficking, prosecute traffickers, and protect survivors.  The GAO found that staffing gaps, unclear roles, and weaknesses in monitoring have impeded some efforts. It found gaps that could impede these efforts, such as unclear roles and weaknesses in monitoring.

https://www.gao.gov/assets/gao-22-106029.pdf

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EU REMOVES DR. SAHIR BERHAN FROM IRAQ SANCTIONS LIST

EU Regulation 2022/1464/EU removed Dr. Sahir Berhan following the decision of the relevant UN Sanctions Committee on 30 August.

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv%3AOJ.L_.2022.231.01.0022.01.ENG&toc=OJ%3AL%3A2022%3A231%3ATOC

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GAFILAT RELEASES AML/CFT MUTUAL EVALUATION REPORT ON PARAGUAY

On 5 September, various outlets reported that the FATF-style regional body GAFILAT, saying that it is noted that Paraguay significantly improved the legal framework for the fight against money laundering and financing of terrorism, and that on effectiveness, it indicates that Paraguay did not enter the so-called grey list of FATF.  The onsite visit took place in August/September 2021

https://www.lanacion.com.py/negocios/2022/09/05/oficial-gafilat-divulga-informe-de-evaluacion-mutua-de-paraguay/

https://www.judiciales.net/gafilat-la-persecucion-del-lavado-de-dinero-uno-de-los-puntos-flojos-de-paraguay/

https://www.gafilat.org/index.php/es/noticias/180-informe-de-evaluacion-mutua-de-la-republica-de-paraguay

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THE CHIPS ARE DOWN: PUTIN SCRAMBLES FOR HIGH-TECH PARTS

On 5 September, Politico claimed an exclusive with an article which says that the authors have gained access to Putin’s “shopping list”, which is divided into 3 priority categories, from the most critical components to the least.  It even includes the price per item that Moscow expects to pay, down to the last kopeck.  It is said that while POLITICO could not independently verify the provenance of the list, 2 experts in military supply chains confirmed it was in line with other research findings about Russia’s military equipment and needs.  Of the 25 items Russia is seeking most desperately, almost all are microchips manufactured by US companies Marvell, Intel, Holt, ISSI, Microchip, Micron, Broadcom and Texas Instruments. Rounding out the list are chips by Japanese firm Renesas (which acquired the US-based IDT), Germany’s Infineon (which acquired US-based Cypress), microcircuits by US company Vicor, and connectors by US-based AirBorn.  Some of the items can be easily found in online electronics retailers, while others have been out of stock for months due to the microchip shortage.

https://www.politico.eu/article/the-chips-are-down-russia-hunts-western-parts-to-run-its-war-machines

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ORGANIZED CRIME AND INSTABILITY: MAPPING ILLICIT HUBS IN WEST AFRICA

On 5 September, SIPRI published this report, saying that the deteriorating security situation across parts of West Africa and the Sahel underscores the importance of better understanding the relationship between crime and conflict; and that the fall of Gaddafi in Libya and the uprising in northern Mali in 2012 triggered a wave of instability that continues to deteriorate to this day.  It highlights problems including include corruption, poor governance, impunity among state security forces and socio-economic marginalisation of communities across swathes of the region – but also says that illicit economies are major sources of funding for countless armed actors across West Africa, and many illicit markets contribute to swelling violence, not least the trafficking of arms. The report maps the key geographic hubs of illicit economies across West Africa (Benin, Burkina Faso, Cabo Verde, Cameroon, Central African Republic, Chad, Côte d’Ivoire, Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone and Togo).

https://globalinitiative.net/wp-content/uploads/2022/08/GITOC-WEAObs-Organized-crime-and-instability-Mapping-illicit-hubs-in-West-Africa.pdf

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