On 10 December, OFAC listed 3 individuals in response to the North Korean regime’s ongoing and serious human rights abuses and censorship. The US Treasury says that it is taking this action in conjunction with the State Department’s “Report on Serious Human Rights Abuses and Censorship in North Korea,” which is being submitted in accordance with the North Korea Sanctions and Policy Enhancement Act of 2016 (NKSPEA). They are – Jong Kyong Thaek, the Minister of State Security; Choe Ryong Hae, the Director of the OGD; and Pak Kwang Ho, the Director of the PAD. Any property or interests in property within (or transiting) US jurisdiction of those designated by OFAC are frozen. Additionally, transactions by US persons involving the designated persons are generally prohibited.
9 December 2018
SIPRI REPORT – GLOBAL ARMS INDUSTRY: US LEADS, RUSSIA SECOND
On 9 December, SIPRI released its latest report on the global arms industry: US companies dominate the Top 100; Russian arms industry moves to second place; UK tops arms exporter in Europe. It also notes that arms sales of Turkish companies rose by 24% 2017; arms sales of the 4 Indian companies ranked in the Top 100 totalled $7.5 billion in 2017, representing a 1.9% share of Top 100 arms sales; and sales of the top 15 manufacturing companies listed in the Fortune Global 500 totalled $2311 billion in 2017 – almost 10 times greater than the total arms sales of the top 15 arms producers ($231.6 billion) in 2017, and almost 6 times greater than the total combined arms sales of the Top 100 ($398.2 billion).
SUSPECTED BRITISH DRUG LORD GOES ON TRIAL IN PARIS
The Telegraph on 9 December reported that Robert Dawes, 46, denies charges that he ran an operation that smuggled 1.3 tons of cocaine, worth £45 million, to France on a flight from Venezuela in 2013. 2 other Britons, named as Nathan Wheat and Kane Price, are also charged with involvement in trafficking, along with 3 Italians allegedly linked with the Camorra. 4 agents of France’s anti-trafficking agency, OCRTIS, posed as corrupt baggage handlers at Charles de Gaulle airport to intercept 31 suitcases containing cocaine belonging to “ghost’ passengers that arrived on a flight from Venezuela. They found evidence indicating that Dawes and his British associates had organised the shipment using encrypted phones.
IRISH COUPLE ACCUSED OF PEOPLE SMUGGLING ARE REFUSED BAIL IN WALES
The Irish Sun on 9 December reported that the Dublin couple arrived at Holyhead from Ireland in a car with 4 Albanian passengers.
US LISTS LUXURY ITEMS SEIZED IN 1MDB CORRUPTION CASE
A yacht, a see-through grand piano, a Monet, a $31 million penthouse and a private jet: US government reveals the list of lavish items seized in Jho Low case. Includes $200 million in artwork.
AUSTRALIAN TAXATION OFFICE CONTRACTOR HAS HISTORY OF BANKRUPTCY AND LINKS TO TAX HAVENS
ABC News on 9 December reported that a privately owned call centre and “business process outsourcing” business with ties to a Texan millionaire family with a controversial corporate history. However, it was recently awarded a $77 million contract to handle Centrelink calls for the Department of Human Services.
The Wall Street Journal on 9 December carried an article about how North Korea’s special-operations division, are covertly training Uganda’s elite troops in skills from martial arts to helicopter-gunnery operations. This is only one example of North Korean soldiers, companies, contractors and arms dealers operating around the world in violation of UN sanctions. North Korean operatives or DPRK-controlled companies in African countries offer cut-price military training, weapons, workers or other services, generating foreign exchange for DPRK. For African nations, incentives range from thrift to geopolitics, say defence analysts and government officials, and the military contracts offer inexpensive equipment and expertise and opportunities for official corruption.
8 December 2018
ISRAEL AUTHORISED NSO SALE OF SPYWARE TO SAUDI ARABIA
Haaretz on 8 December reported that former U.S. officials have told the Washington Post that Israel authorised cyber-company NSO to sell surveillance software to Saudi Arabia in return for Saudi discreet support for the Israeli struggle against Iran; and that the deal was reportedly made through NSO’s affiliate Q Cyber Technologies, located in Luxembourg.
SUDAN ALLOWS GOLD EXPORTS AFTER 6-YEAR GOVERNMENT MONOPOLY
On 8 December, Asharq Al-Awsat reported that the Central Bank of Sudan has agreed to allow foreign and domestic mining companies and individuals to export gold after a government monopoly of more than 6 years. It says that Sudan produces 150 tons of gold per year, but the Central Bank managed to export no more than 37 tons in 2018; with some 113 tons having been smuggled into neighbouring countries.
HESTON BLUMENTHAL, THE TAX HAVENS AND THE RIPPED-OFF WORKERS
The Brisbane Times on 8 December saying that international restaurant empire fronted by world-renowned chef Heston Blumenthal is run through a series of notorious offshore tax havens while also substantially underpaying staff at its high-end high-end Australian eatery. It says that the Australian businesses are routed through the volcanic Caribbean island of Nevis where foreign companies pay zero tax on their worldwide earnings. Directors are based on the Isle of Man and shares directors with its ultimate owner Lowenthal Corporation, also based on Isle of Man. Fat Duck and the group’s other UK restaurants are routed through a separate Nevis-based company and are also ultimately owned by Lowenthal Corporation.
CORPORATE LAND GRAB EXPLOITS PAPUA NEW GUINEA’S INDIGENOUS PEOPLE
Ekklesia on 8 December reported that private companies are illegally occupying land in Papua New Guinea for logging and palm oil plantations, according to a new report published by War on Want and Act NOW!, its partner in Papua New Guinea. The report, The SABL land grab: Papua New Guinea’s ongoing human rights scandal, is said to reveal the devastating impact of corporate land grabs on the indigenous population. Foreign companies are exploiting Special Agricultural Business Leases (SABL), without due process, to illegally lease land from indigenous customary landowners. The land and its inhabitants are then exploited for profit, the rich natural resources exported to countries like China, and the indigenous peoples forced to work on their own land for poverty wages.
The report is at –
On 7 December, iGB reported that the European Gaming and Betting Association (EGBA) is urging countries across Europe to bolster their protection measures in the online gambling sector after a new report found that Denmark is the only EU Member State fully embracing consumer protection guidelines; and claims that they are putting the safety of consumers at risk with inadequate levels of protection.
The report itself is available at –
On 8 December, ICIJ looked back into the Panama Papers files to see if it could identify the unnamed accused in the recent indictments lodged in the US. These are the 4 of 5 American clients whom the DoJ alleges played key roles in offshore tax schemes but have not been charged.
7 December 2018
SOMALIA REMAINS THE HIGHEST BRIBERY RISK IN TRACE INDEX
On 7 December, the Wall Street Journal reported that business compliance group Trace International’s latest edition of its anti-bribery index, finding for the second consecutive year that Somalia poses the highest risk. The 2018 index found that New Zealand, Sweden, Norway, Denmark and Finland are among the least risky countries, while Somalia, Libya, Venezuela, Chad and Turkmenistan are among the most.
ASIAN EXPORT NATIONS SOFT ON CORPORATE BRIBES OF FOREIGN OFFICIALS
Nikkei Asian Review on 7 December reported that Asia’s largest export countries show scant interest in holding their companies accountable for bribing foreign civil servants, according to a recent report from Transparency International, a Berlin-based NGO: “Exporting Corruption — Progress Report 2018”. The paper showed that 5 countries and 1 territory practice “little or no” enforcement against companies suspected of paying off officials.
NEED HELP LAUNDERING MONEY? WHAT ABOUT BUYING YOUR OWN BANK?
On 7 December, an article on Medium saying that to further their bribery and laundering schemes, 3 Venezuelans had bought the Banco Peravia in the Dominican Republic for the purpose of laundering money and paying bribes to Venezuelan officials. A number of Peravia’s executives have been under investigation since 2015 for allegedly defrauding the bank. Meinl Bank Antigua was also said to have been purchased by the Brazilian construction company Odebrecht and reportedly used to move dirty money and pay bribes to officials in at least 12 different countries.
UK: PUBLISHED DETAILS OF DELIBERATE TAX DEFAULTERS
On 7 December, HMRC published the latest list of the details of deliberate tax defaulters, these are people who have received penalties either for deliberate errors in their tax returns or deliberately failing to comply with their tax obligations.
EU COMMISSION STEPS UP FIGHT AGAINST ILLICIT TOBACCO TRADE
On 7 December, the European Commission announced that it had adopted an Action Plan to enable the European Union to continue fighting illegal tobacco trade, a phenomenon that deprives it and its Member States of roughly €10 billion of public revenue every year. The Action Plan outlines concrete steps to address both the supply of and the demand for illegal tobacco products. The new Action Plan builds on the EU’s 2013 Strategy on fighting the illicit tobacco trade. With the recent entry into force of the WHO Framework Convention on Tobacco Control (FCTC) Protocol and the roll-out of the new EU traceability system, required under the Protocol, the Action Plan proposes further initiatives to ensure the effective fight against illicit tobacco products. They include actions to fully exploit the potential of the FCTC Protocol as a global instrument, to engage key source and trade countries, thus limiting the supply arriving at EU’s borders, and to raise awareness among consumers.
MYSTERY FUNDER IN BILLION-POUND OLIGARCH FISHING BATTLE
The Law Society Gazette on 7 December reported on a row in which 2 Russian oligarchs are wrestling for a stake in one of the world’s largest fishing businesses took another twist this week as lawyers for one of the men sought assurances over a mystery funder. Russian businessman Alexander Tugushev is against Vitaly Orlov in the High Court for a stake in the $1.5 billion Norebo Group. Orlov is challenging the jurisdiction of the English courts and resisting the continuation of a freezing order.
HOW DOES IRS DEFINE TAX EVASION ETC?
An article from Foodman CPAs and Advisors on 7 December starts by saying that the IRS Tax Crimes Handbook states that there are 2 kinds of tax evasion: the wilful attempt to evade or defeat the assessment of a tax, and the wilful attempt to evade or defeat the payment of a tax. The article looks at how the important terms are defined by the IRS, including what is an “attempt”.
KASSIM TAJIDEEN, BEIRUT MONEY LAUNDERER WORKING IN AFRICA AND LEBANON, AND WHO WAS FUNDING HEZBOLLAH, PLEADS GUILTY IN US
On 7 December, Kenneth Rijock in his blog reported this case and said that Tajideen and his co-conspirators allegedly moved over $1 billion through the US financial system, and he apparently has a long history of providing financial support to Hezbollah. he was named a Specially Designated Global Terrorist by OFAC in 2009. Rijock also provided illustrations of the networks used.
JERSEY: NEW LAWS DESIGNED TO PROTECT JERSEY’S INTERNATIONAL INTERESTS AND ENSURE IT IS ABLE TO RESPOND EFFECTIVELY TO THE POTENTIAL IMPACTS OF BREXIT
A news release from Jersey on 7 December reported on the successful enactment of the Taxation (Companies – Economic Substance) Law – which provides the means to fulfil the commitments made by the Government to the EU Code of Conduct Group in November 2017; the Sanctions and Asset-Freezing Law preserves Jersey’s power to impose EU sanctions and also allows Jersey to impose UK sanctions; and the EU Legislation (Customs Union, Import and Export Control) regulations that create the powers necessary to implement the landmark Jersey/UK Customs Arrangement, agreed in November, which establishes a customs union between Jersey and the UK.
EU-WIDE ACTION AGAINST BUYERS OF COUNTERFEIT MONEY ON THE DARKNET
Europol on 7 December reported on how law enforcement agencies performed actions against suspects who bought counterfeit euro banknotes on illegal platforms on the Darknet. These actions, coordinated by Europol, started on 19 November and the majority of interventions took place from 3 to 6 December. Almost 300 house searches were conducted in 13 different countries and 235 suspects were detained. Law enforcement also seized around 1,500 counterfeit euro banknotes.
IRELAND LEGISLATES FOR NEW CORPORATE CRIME AGENCY
Out-Law on 7 December published an article saying that a new agency with powers to investigate and prosecute cases of corporate crime is to be set up in Ireland, with the existing Office of the Director of Corporate Enforcement (the ODCE) will be replaced by a new Corporate Enforcement Authority (CEA).
ECONOMIC SUBSTANCE REQUIREMENTS IN THE CAYMAN ISLANDS
On 7 December, Appleby published an article saying that the Cayman Islands government has published draft legislation that will require certain Cayman Islands entities carrying on specified activities to have ‘adequate substance’ in the Cayman Islands. Any relevant entity that may be impacted by this legislation will wish to monitor these developments closely. The government of the Cayman Islands has been working closely with the EU Code Group to ensure that its concerns are adequately addressed.
AUTHORITIES IN COLOMBIA HAVE DISMANTLED SEVERAL INTERNATIONAL MONEY LAUNDERING ORGANISATIONS THAT EMPLOYED DRUG MULES FOR DIRTY MONEY FOR MEXICAN CARTELS
On 7 December, Insight Crime published an article saying that the operations provided further details on the relationship between criminal organisations in both countries. Authorities arrested 27 suspected members of 4 transnational money launder organisations for transporting money from Mexico into Colombia.
US GRAIN EXPORTER UNDER INVESTIGATION FOR ALLEGED BRIBERY OF MEXICO CUSTOMS OFFICIALS
On 7 December, Buckley Sandler reported that US-based agriculture company, CHS Inc., disclosed that it is co-operating with an investigation being conducted by the SEC and DoJ involving payments made to Mexican customs officials. The payments were made in connection with grain shipments crossing the Mexican border by train. CHS Inc is owned primarily by farmer and rancher co-operatives and has extensive operations in the energy sector in addition to agriculture.
BOGUS ISLE OF MAN FSA EMAILS
On 7 December, the FSA said that it had recently become aware that businesses in the Isle of Man have received emails purporting to be from the Financial Services Authority. These bogus emails have the heading styled, “December Sanctions Update – Payroll Providers” with the sender being listed as Isle of Man Financial Services Authority firstname.lastname@example.org
UK: FCA PROPOSING PERMANENT MEASURES FOR CFD AND BINARY OPTIONS
On 7 December, the FCA said that it is proposing rules to address harm to retail consumers from the sale of certain complex derivative products with the publication of 2 consultation papers. New rules would ban the sale, marketing and distribution of binary options to retail consumers; and restrict the sale, marketing and distribution of contracts for difference (CFD) and similar products to retail customers.
SEC HALTS ALLEGED INSIDER TRADING RING SPANNING 3 COUNTRIES
On 7 December, the SEC said that it has filed insider trading charges against an IT contractor and 2 others he illegally tipped with confidential client information that he stole while working in the Singapore branch of an investment bank. It also obtained a freeze of assets in 3 US brokerage accounts and a US bank account connected to the alleged trading.
IRELAND: REVENUE SEIZES HERBAL CANNABIS WORTH €1.36 MILLION AT DUBLIN PORT
A news release on 7 December announced that Irish customs during routine operations involving the deployment of Revenue’s mobile x-ray scanner and with the assistance of detector dog, Meg, Revenue officers in Dublin Port seized 68 kg of herbal cannabis with an estimated street value of €1.36 million. The drugs were found concealed in a consignment of goods which had arrived into Dublin Port originating in Spain.
GLOBAL WITNESS: MANAGEMENT OF DIAMOND INDUSTRY ‘TEST OF ZIMBABWE’S COMMITMENT TO ECONOMIC REFORM’
On 7 December, NGO Global Witness issued a briefing called “Leaving no stone unturned here”, saying that, 1 year on from the inauguration of President Emmerson Mnangagwa, management of Zimbabwe’s diamond industry is the litmus test of the new government’s commitment to economic reform, and calls on the Zimbabwean government and companies in the diamond industry to implement a raft of transparency measures, which are essential if the diamond industry is to realise its potential for the people of Zimbabwe.
CLEANING UP CLOSER TO HOME – WHY THE CROWN DEPENDENCIES NEED TO GO PUBLIC
On 4th December, NGO Global Witness published an article saying that, as ministers from the Overseas Territories will be sitting down with the FCO to figure out how they are going to follow through on the UK Parliament’s historic vote to require them to create public registers of the real owners of their anonymous companies, “what of the UK’s tax havens closer to home?”.
REPORT: CANNABINOIDS HAVE LIMITED IMPACT ON MS SYMPTOMS
On 3rd December, the Pharmaceutical Journal reported that cannabinoids have limited efficacy in improving the symptoms of multiple sclerosis (MS), authors of a systematic review and meta-analysis have concluded. Researchers used data from 17 randomised controlled trials looking at the effects of oral or oromucosal medicinal cannabinoids involving a total of 3,161 patients with MS. They describe the study as the most complete systematic review and meta-analysis of the effect of cannabinoids on MS.
BOEING CANCELS CONTROVERSIAL SATELLITE ORDER FUNDED BY CHINA
On 7 December, the Daily Caller reported that Boeing had decided to cancel an order for a satellite that uses sensitive technology used by the US military and was reportedly being funded by a state-owned Chinese financial firm – citing non-payment and saying it was a business decision. A Wall Street Journal article had revealed the web of financial transactions that skirted around US export laws, which would ban Boeing from selling satellites to China, and resulted in the Chinese government funnelling nearly $200 million to the project and obtaining a large stake of the company responsible for the satellite.
JAPANESE GOVERNMENT CONSIDERING A BAN ON GOVERNMENT PURCHASES OF EQUIPMENT FROM CHINESE VENDORS HUAWEI TECHNOLOGIES AND ZTE
RCR Wireless News on 7 December reported that it was considering the move with the aim of preventing intelligence leaks and cyberattacks. According to the reports, the Japanese government does not plan to specifically name Huawei and ZTE in the revision, but will put in place measures aimed at strengthening security that apply to these vendors. Australian authorities in August said it would prevent certain vendors from taking part in the roll out of 5G mobile networks across the country, effectively banning Chinese companies Huawei and ZTE from involvement, and UK’s BT Group said it was removing Huawei’s equipment from the core of its existing 3G and 4G mobile operations.
SCOTTISH DIRTY MONEY CONVICTIONS ‘NOTABLY LOWER’
The Herald in Scotland on 7 December reported that Scotland convicts far fewer people under money-laundering laws than the rest of the UK, according to the FATF report on the UK. However, insiders in Scotland are not convinced that the comparison is fair – because Scottish prosecutors have other options for charging launderers and because they face a higher evidential bar, with the requirement for corroboration.
GERMAN REAL ESTATE MARKET A HOTBED OF MONEY LAUNDERING
Deutsche Welle on 7 December reported that about €30 billion of dubiously-sourced money was funnelled into German real estate in 2017. Transparency International is calling for a series of reforms to combat the problem.