THINGS YOU MAY HAVE MISSED – JANUARY 25

I have to admit being a bit fascinated by the row over OFSI issuing a specific sanctions licence or licences to allow a law firm help a sanctioned Russian sue the founder of Bellingcat for defamation, for apparently claiming that the Russian was the foundfer and leader of the notorious Wagner Group – something that the Russian now freely admits, and boasts of. Having previously been responsbile for such licences, drawing them up and advising on whether the Minister should sign and authorise them, there seems to be 3 questions –

What test or tests did OFSI undertake before agreeing to grant, or recommend the granting of, the licence(s)?.

What due diligence did the law firm undertake, as surely it would have been obvious that the Russian was, indeed, founder and head of the Wagner Group, and that he and it had a reputation that would be unlikely to be damaged by anything bellingcat said about him (although, obviously, the lawsuit was just aimed at quietening and bankrupting the victim)?.

At what level was the licence(s) authorised? I note that UK General Licences are just signed “OFSI”. One would have thought a licence, particularly where it involved a potentially highly sensitive matter, would (or should) be authorised and signed (or signed off) by a Minister (and would be backed up by a detailed explanatory brief explaining the need and justification for the licence).

Was it the case that the argument was that the licence(s) was/were necessary in the name of natural justice, that no financial benefit was flowing to the claimant (and any damages would be frozen while the sanctions were in force), and it was for the courts to decide whether the case should be heard?

Is it seen as one of the roles of OFSI to be a cut-out, providing political protection for the Secretary of State and Ministers in the event of any embarassing decision? If so, do not those same politicians frame the policies that OFSI follows?

I know it is said that no-one should be denied legal representation, no matter how reprehensible they may appear, and that the law firm involved had the good grace to withdraw their services following the invasion of Ukraine last year. However, The case does have the appearance of the type of “lawfare” that had become all too common, with those with deep pockets using the too-amenable English courts (Bellingcat, I believe, is based in the Netherlands, but the case was not being brought there) to quieten inconvenient critics or jounalists. This, sadly, is nothing new, as anyone with memories of Robert Maxwell will acknowledge.

25 JANUARY 2023

https://www.buymeacoffee.com/KoIvM842y

FINCEN ISSUES ALERT ON POTENTIAL US COMMERCIAL REAL ESTATE INVESTMENTS BY SANCTIONED RUSSIAN ELITES, OLIGARCHS AND THEIR PROXIES

On 25 January, FinCEN advised that it had issued an Alert to financial institutions regarding potential investments in the US commercial real estate sector by sanctioned Russian elites, oligarchs, their family members, and the entities through which they act.  It lists red flags and typologies involving potential sanctions evasion in the commercial real estate sector.  The new Alert builds on that from March 2022t identifying real estate, luxury goods, and other high value assets involving sanctions Russian and elites, is the fourth alert issued by FinCEN on potential Russian illicit financial activity since Russia’s invasion of Ukraine in February 2022.

https://www.fincen.gov/sites/default/files/shared/FinCEN%20Alert%20Real%20Estate%20FINAL%20508_1-25-23%20FINAL%20FINAL.pdf

https://www.fincen.gov/news/news-releases/fincen-alert-potential-us-commercial-real-estate-investments-sanctioned-russian

https://www.buymeacoffee.com/KoIvM842y

SURINAME: AML/CFT MUTUAL EVALUATION REPORT

On 25 January, the FATF-style regional body, CFATF, published this MER, adopted at a Plenary in November.  The report analyses the level of compliance with the FATF 40 Recommendations, the level of effectiveness of Suriname’s AML/CFT system and provides recommendations on how the system could be strengthened.  The on-site visit took place in February/March 2022.

https://www.cfatf-gafic.org/home-test/english-documents/4th-round-meval-reports/19770-suriname-4th-round-mer/file

https://www.buymeacoffee.com/KoIvM842y

AN INTERNATIONAL COUNTER-RANSOMWARE TASK FORCE ANNOUNCED AT A WHITE HOUSE EVENT IN NOVEMBER HAS OFFICIALLY COMMENCED OPERATIONS

On 23 January, The Record reported that the International Counter Ransomware Task Force’s (ICRTF) operations are intended to drive collaboration among a coalition of 36 member states and the EU to counter the spread and impact of ransomware which, despite typically being a criminal rather than state-based activity, has become a significant national security threat in recent years.

https://therecord.media/international-counter-ransomware-task-force-kicks-off/

https://www.buymeacoffee.com/KoIvM842y

FAQ: WHAT’S A PROXY? USING RELATIVES, SHELL COMPANIES, AND OTHER STAND-INS TO HIDE ILLICIT WEALTH

On 24 January, OCCRP published this FAQ saying that proxies are people that form a crucial part of a sophisticated secrecy industry that undermines the global financial system by letting dirty money flow undetected, unchecked, and uninterrupted around the world.  The article sets out to provide everything you need to know about how sanctioned oligarchs, crime bosses, and corrupt politicians, often abetted by financial industry professionals, are able to rely on friends, family, and business associates to disguise and protect their interests.

https://www.occrp.org/en/asset-tracker/faq-whats-a-proxy-using-relatives-shell-companies-and-other-stand-ins-to-hide-illicit-wealth

https://www.buymeacoffee.com/KoIvM842y

FREEZING ORDERS, SEARCH AND IMAGING ORDERS AND DISCLOSURE ORDERS

On 25 January, this article from Fried Frank in its Distilling Disputes series provides an overview and insights into the pre-emptive remedies available in the English Courts.  These are of particular relevance in the context of the pursuit of fraud claims, and this article highlights the toolbox of remedies available to potential claimants, including Freezing Orders, Disclosure Orders and Search and Imaging Orders, and other ancillary powers available to the English Courts.

https://www.friedfrank.com/uploads/documents/94ca1a1c782f7f75382149e36b06a301.pdf

https://www.buymeacoffee.com/KoIvM842y

US ISSUES SANCTIONS LICENCE TO TRINIDAD AND TOBAGO TO DEVELOP VENEZUELA OFFSHORE GAS FIELD

On 25 January, EurActiv reported that the US has granted a licence to Trinidad and Tobago to develop a major gas field located in Venezuelan territorial waters, marking a further easing of some sanctions on Venezuela.

https://www.euractiv.com/section/global-europe/news/us-issues-license-to-trinidad-and-tobago-to-develop-venezuela-offshore-gas-field/

THE COMMISSIONER OF POLICE OF THE CAYMAN ISLANDS: A SIGNIFICANT AMOUNT OF MONEY LAUNDERING IS LINKED TO GAMBLING

On 24 January, the Loop website reported that during a Select Committee hearing, the Commissioner of Police of the Cayman Islands, said that “illicit proceeds of illegal gambling in the Cayman Islands are somewhere between 30 million and 50 million Cayman dollars per annum” and that “illegal gambling is an organised criminal activity by criminal enterprise” with international links.

https://cayman.loopnews.com/content/byrne-significant-amount-money-laundering-linked-gambling

AML/CFT ASSESSMENT REPORT: ESTONIA MUST STEP UP LAW ENFORCEMENT AML EFFORTS

On 25 January, ERR reported the Council of Europe’s FATF-style regional body MONEYVAL encourages Estonia to further strengthen measures to combat money laundering and the financing of terrorism, among others by reinforcing the private sector’s capacities and performance as well as improving its law enforcement efforts in this field.  The mutual evaluation report follows an on-site visit took place in April/May 2022.

https://news.err.ee/1608862661/report-estonia-must-step-up-law-enforcement-anti-money-laundering-efforts

https://www.fin.ee/en/news/moneyval-publishes-mutual-evaluation-report-estonia

https://www.coe.int/en/web/moneyval/-/estonia-should-continue-strengthening-the-capacities-and-performance-of-the-private-sector-and-improve-its-law-enforcement-efforts-in-combating-money-laundering-and-terrorism-financing

https://rm.coe.int/moneyval-2022-11-mer-estonia/1680a9dd96