After saying the other day that we, on the Pacific side of Panama, are less affected by passing tropical storms, this week events have made me think again. Where we are we were fine, but major (if temporary) flooding of some major roads in and around the city saw cars submerged. Of course, as usual with the torrential rain here, it has all now vanished…
Meanwhile, Russian foreign minister Sergey Lavrov has had remarks comparing the US invasion of Panama in 1989 to what Russia has been up to, in what seems like another instance of Russian disinformation. This prompted a fact-check article by a website produced by the Voice of America –
13 OCTOBER 2022
FATF GREY-LISTING LOOMING AS SOUTH AFRICA RUSHES TO MEET TIGHT DEADLINE
On 11 October, an article from ENSafrica reminds one that last year FATF gave the country a deadline of February 2023 to remedy all the deficiencies or face possible grey listing. It lists some of the shortcomings identified by FATF including in the area of prosecution of State Capture crimes and convictions. It also says that since the FATF report was published, South Africa has taken a number of steps in a bid to prove to global financial bodies that it is capable of fighting money laundering and other forms of corruption and to address the shortcoming.
LEBANON AND ISRAEL CLINCH MARITIME BORDER DEAL
On 11 October, Dryad Global had an article on the reported deal over a disputed area in the Mediterranean Sea containing gas and claimed by both states.
On 12 October, a Commentary from the Carnegie Center said that the landmark agreement is far from a peace deal, but both countries now have vested economic interests in maintaining calm along their common border regions.
US PORTS AND TERMINALS TARGETS OF INCREASED CYBER SECURITY ATTACKS
On 12 October, Dryad Global reported that Jones Walker LLP have just released the findings of its 2022 Ports &Terminals Cybersecurity Survey, noting that cyber attacks are on the rise at US ports & terminals.
YEMEN’S FAILED TRUCE
On 13 October, Dryad Global reported that, on 2 October, the deadline for extending the UN-brokered truce agreement between the Houthi rebels and the Saudi-led coalition in Yemen was missed, but that during its implementation, Yemen witnessed the longest period of relative calm since the country’s civil war began in 2014. It offers an analysis which explores the impact of Yemen’s failed truce on the maritime domain.
UK HALF-YEAR FRAUD REPORT 2022
The UK Finance 2022 Half Year Fraud Update, sponsored by LexisNexis Risk Solutions, shows that after the rises in fraud to record highs during the pandemic, fraud levels fell in the first half of this year as consumers return to normal routines. In the first half of this year, criminals stole a total of £609.8 million through authorised and unauthorised fraud and scams, a decrease of just under 13% compared to H1 2021. The advanced security systems used by banks also prevented just under £584 million from being stolen. It is said that the report shows that while the end of the pandemic has seen a fall in overall fraud losses, some fraud types have increased as criminals continue to adapt their methods.
SOUTH KOREAN AND TAIWANESE CHIP MAKERS EXEMPTION FROM US EXPORT CONTROLS
On 12 October, the Wall Street Journal reported that South Korean memory-chip giant SKHynix was the first to publicly disclose an exemption that avoids production disruptions and allows the export of advanced chips and related equipment to China. On 13 October, it reported that Samsung Electronics had also been granted an exemption. It also reported on 13 October that the Taiwan Semiconductor Manufacturing Co (TSMC), the world’s largest chip maker, had said that its third-quarter net profit rose 80% to a new record, and that it had been granted a 1-year exemption from new US restrictions, allowing it to keep expanding its facilities in the country.
NEARLY €5 BILLION BLOCKED IN GERMANY DUE TO RUSSIA SANCTIONS
On 13 October, Reuters reported on a finance ministry letter which says that assets, company holdings and account balances have been blocked in Germany since the start of the war in Ukraine due to related sanctions on Russia.
WORLD BANK HAS SANCTIONED 7 NIGERIAN BUSINESSES AND INDIVIDUALS
On 13 October, Punch in Nigeria reported that the World Bank has disclosed that it sanctioned 7 Nigerian businesses and individuals for corruption during its 2022 fiscal year to 30 June. The list contained 3 Nigerians and 4 Nigerian companies who were found guilty of corruption, with 2 of the companies having been debarred by the African Development Bank.
THE LUCRATIVE BUSINESS OF CHINESE CIGARETTE SMUGGLING
On 13 October, Voxeurop published an article saying that the China National Tobacco Corporation is the world’s largest tobacco company, accounting for nearly half of global cigarette production. It is said to have expanded aggressively into new countries as part of the controversial “Belt and Road” initiative, but some of these new markets are not legal ones, a joint investigation by OCCRP and the Kyiv Post in found. For example, over the past 7 years, its only factory in Europe, in Romania, has flooded Ukraine with at least half a billion cigarettes. None of the Chinese brands are legally sold there, according to the State Fiscal Service and an association of the country’s largest tobacco producers. The factory declared it was legally exporting the smokes to 14 different companies in Ukraine, according to Romanian data leaked to OCCRP, but reporters found that at least 3 of these were under investigation for large-scale cigarette smuggling.
ZAMBIA SEEKS WAYS TO CURB TRADE-BASED MONEY LAUNDERING
On 13 October, the Diggers website reported that the country’s Financial Intelligence Centre says there is need to constitute a unit which will adequately analyse trade data because trade-based money laundering risks have been identified in Zambia. A report has also identified mining, construction, agriculture and retail, as sectors which are most associated to money laundering activities in the country.
BVI: FORMER DIRECTOR OF THE SECRETARIAT OF INTERNATIONAL AFFAIRS ARRESTED IN CONNECTION WITH ANDREW FAHIE AFFAIR
On 11 October, 284 Media reported that Najan Christopher had been arrested, reportedly on charges of breach of trust by a public officer, and false assumption of authority in connection with a “diplomatic note” calling for the unconditional release of arrested Premier Andrew Fahie from US federal custody in Miami, where he faces money laundering and drug trafficking charges, on the ground of diplomatic immunity.
FIREARMS OPERATION NETS 350 WEAPONS, 3,300 ROUNDS OF AMMUNITION AND RECORD DRUG HAULS ACROSS THE CARIBBEAN
On 12 October, INTERPOL announced the results of Operation Trigger, a joint firearms operation between INTERPOL and the Caribbean Community (CARICOM) Implementation Agency for Crime and Security (IMPACS). The operation last month saw officers from 19 countries coordinate controls at airports, seaports, land border and inland hotspots, acting on intelligence pointing to organized crime groups and individuals involved in firearms trafficking. They also searched warehouses, inspected packages and carried out targeted checks at firearms dealerships, shooting ranges and private security companies.
SERVICE OF JUDICIAL AND EXTRAJUDICIAL DOCUMENTS BETWEEN MEMBER STATES UNDER THE NEW EU SERVICE REGULATION
On 6 October, Irish law firm McCann Fitzgerald published an article about the Recast Service Regulation, which came into force in July. It applies between all Member States (including Denmark).
GREEN ENERGY DEPENDS ON CRITICAL MINERALS. WHO CONTROLS THE SUPPLY CHAINS?
A Paper from the Harvard Law School Forum on Corporate Governance posed this question in respect of minerals critical to the production of clean energy (including cobalt, copper, lithium, nickel, and rare earth elements). It argues that the issue of who ultimately controls the production of minerals and the governance context in which they operate are also very important but much less researched. It says that analysis reveals that China’s control over the global value chains involving critical minerals and rare earth elements extends beyond what is commonly assumed. First, China is the dominant actor in the supply chains of clean technologies, including upstream (mining), even though most mines are not located in China. Second, this raises important strategic issues given that large reserves of critical minerals are located outside of the EU and the US – China could, for example, interfere in the operations of private companies controlled by Chinese entities, even if they are based in other countries.
TORNADO CASH ALTERNATIVES BRIEFING NOTE
On 11 October, Elliptic issued a briefing note which details its analysis into 6 prominent alternative Ethereum-based obfuscation protocols that have been mentioned as potentially the next Tornado Cash.
SCOTLAND: UNIVERSITY STUDENT ACCUSED OF £300,000 MONEY LAUNDERING SCHEME
On 11 October, STV reported that a University of Stirling student is to face trial accused of laundering nearly £300,000 in connection with serious organised crime.
WHY INDEPENDENT SCHOOLS NEED AML
On 11 October, Finextra published an article saying that there has been a significant focus on the dirty money that is circulating in the UK. Institutions of all kinds – including prestigious law firms and high-profile banks – have all been issued warnings, if not penalties, for not being vigilant about the risk of money laundering. It argues that independent schools are next. Alongside property and other high value assets, bad actors have turned to private schools as a lucrative vehicle for hiding their money.
UAE AND CYPRUS: TOP DESTINATIONS FOR LUKASHENKA’S MONEY
On 11 October, the Belarusian Investigation Center reported on transfer of money allegedly made by real estate developers who are backers of President Lukashenko. It claims that Lukashenka even issued decrees releasing the brothers concerned from the necessary land auctioning procedure – costing the taxpayer an estimated $1 billion.
POLICE NET ‘ONE OF UK’S LARGEST-EVER HAULS OF 3D-PRINTED GUNS’ IN RAID ON FACTORY IN NORTH-WEST LONDON
On 12 October, Yahoo News reported that 2 men have been arrested and that police said that they found a large number of components that could be used to create weapons and believe 3D-printed firearms were being manufactured to sell, adding that this highlights how the emerging threat of 3D firearms continues to evolve.
MAKING FINANCIAL INVESTIGATIONS INTO ENVIRONMENTAL CRIMES THE NORM
A post from the WWF said that financial investigations are essential for identifying and evidencing who pays bribes to whom, enabling investigators to trace, seize and eventually confiscate the proceeds and instrumentalities of environmental crimes. However, the use of financial tools emerged as the still-missing element in environmental crime investigations at an online discussion between members of the UN Convention against Corruption (UNCAC) Coalition’s Environmental Crime & Corruption Working Group. In that meeting in June 2022, the Basel Institute on Governance shared high-level learning on good practice from financial investigations and asset recovery research conducted under the Targeting Natural Resource Corruption project.
RUSSIAN FISHING VESSELS CAN NOW ONLY CALL AT 3 PORTS OF NORWAY
On 12 October, Insurance Marine News reported that, following explosions in the Nordstream pipelines and increased geopolitical tensions as a result of Russia’s war in Ukraine have now seen Norway decide to permit Russian fishing vessels to call at only 3 Norwegian ports.
US: BANKRUPTCY BASICS – A PRIMER
On 12 October, the Congressional Research Service published a briefing intended to serve as a primer on the basics of U.S. bankruptcy law. It provides a brief overview of the most essential concepts necessary for an informed understanding of the US bankruptcy system.
PAKISTAN’S LARGEST COMMERCIAL BANK, HABIB BANK LIMITED FACES SECONDARY LIABILITY IN A TERROR FINANCING CASE IN THE US
On 30 September, Dawn in Pakistan reported that the bank insists that it adheres to all laws and regulations, terming the allegations “meritless”. It is accused of joining in a conspiracy to launch attacks that killed or injured 370 plaintiffs or their family members in Afghanistan between 2010 and 2019.
NORTH MACEDONIA BLACKLISTS 15 ISLAMIC EXTREMISTS
On 6 October, Balkan Insight reported that North Macedonia’s Financial Intelligence Directorate said that the government has blacklisted 15 Islamist extremists. They are prohibited from ownership, transfer or conversion of any property, directly or indirectly; and banned from establishing or extending any work or business relations.
ITALY: POLICE DISMANTLE NETWORK OF CORRUPT PORT WORKERS FACILITATING ‘NDRANGHETA DRUG TRAFFICKING
On 8 October, Homeland Security Today reported that, with the support of Europol and Eurojust, the Guardia di Finanza has dismantled a criminal network which relied on corrupt workers in the port of Gioia Tauro to smuggle hundreds of millions of euros’ worth of cocaine into Europe.
US COMMERCE DEPARTMENT ISSUES 2 RULES IMPACTING CHINA EXPORTS
On 13 October, an article from Bass Berry & Sims published an article advising that the Commerce Department Bureau of Industry and Security (BIS) announced new controls on exports to China related to semiconductors; and it 38 Chinese entities to the Unverified List (UVL) and established new criteria for adding entities to the Entity List.
PAKISTAN, UKRAINE AND THE RACE FOR THIRD-PARTY AMMUNITION
On 6 October, an article from The Drive says that, with the ongoing war using up ammunition at a rapid rate, Pakistan has emerged as an important source and an air bridge was established to bring much-needed ammunition to Ukraine. Both Russia and Ukraine have been looking for any means to refill their ammunition reserves. It says that open-source intelligence revealed that a RAF cargo transport was conducting almost daily flights from Romania’s Cluj International Airport or RAF Akrotiri in Cyprus to Pakistan’s Nur Khan Air Base; this after the UK announced it would be supplying Ukraine with more than 50,000 Soviet-type artillery shells.
OECD CALLS FOR GREATER TAX TRANSPARENCY ON CRYPTO ASSETS
On 13 October, ZyCrypto reported that the OECD has published a document titled: “Crypto-Asset Reporting Framework and Amendments to the Common Reporting Standard”. The paper also includes amendments to the Common Reporting Standard (CRS), adopted in 2014. It is said that the CARF will ensure transparency concerning crypto-asset transactions by automatically exchanging such information with the jurisdictions of residence of taxpayers annually in a standardised manner similar to the CRS. It also says that a OECD review of the CRS has resulted in amendments in 2 key areas.
UK: EXPORT CONTROL (AMENDMENT) (No. 2) ORDER 2022
On 13 October, the UK published this Order which amends Schedule 2 to the 2008 Order, which lists military goods, software and technology subject to export controls. The changes include those to take account of changes made to the Wassenaar Arrangement munitions list.
NORTHERN IRELAND: ORGANISED CRIME BRANCH CARRIES OUT 10 SEARCHES SEIZING CASH, ARTWORK AND DESIGNER GOODS
A news release from the Police Service of Northern Ireland advised that officers have seized cash along with high-value artwork, designer goods and precious stones as part of an ongoing proactive policing operation targeting organised crime gangs involved in the supply of drugs.
NEW JERSEY REAL ESTATE DEVELOPMENT FIRM AND 4 EXECUTIVES CHARGED WITH $600 MILLION PONZI-LIKE FRAUD
On 13 October, a release from Mondo Visione advised that the SEC had charged New Jersey-based National Realty Investment Advisors LLC (NRIA) and 4 of its former executives with running a Ponzi-like scheme that raised approximately $600 million from about 2,000 investors. The complaint alleges that beginning in 2018, NRIA and its executives raised funds by promising investors their money would be used to buy and develop real estate properties, which would generate profits through a fund that NRIA set up to invest in the projects.
FINANCIAL CRIME RISK ASSESSMENT LAUNCHED IN JERSEY
On 13 October, the BBC reported that the Government of Jersey has launched an assessment into the risk of financial crime posed by all companies, partnerships, and trusts on the island. The Jersey FSC is due to publish a report on its findings in 2023.
THE NORTH KOREAN CRYPTO THREAT
On 13 October, K2 Integrity published a Paper which says that the North Korean threat to the crypto ecosystem is the highest form of immediate risk to the crypto-economy
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