Month: May 2022

70% Accountants and Lawyers Have Money Laundering Fears Over Russian Dark Funds

Money Laundering, Sanctions
LONDON, UNITED KINGDOM 25th MAY, 2022: 70% of accountants and lawyers are more concerned about money laundering since Russian events and sanctions began, with 75% moving anti-money laundering (AML) up the company agenda in the past year. That’s according to First AML, the end-to-end AML software solution, which surveyed 200 accountants and lawyers in the UK to discover attitudes toward current compliance and AML procedures. Despite 53% of respondents having identified an instance of suspected money laundering in the past three years (with 24% identifying more than one) only 45% are completely confident in their AML procedures. Alongside this, a…

Time to Shut Down Dirty Money’s “London Laundromat”

Money Laundering
Just before Russia launched its full-scale invasion of Ukraine on February 24, the British anticorruption advocacy group Transparency International UK estimated that Russians accused of corruption or having close links to the Kremlin owned an estimated £1.5 billion worth of property in the United Kingdom, and that front companies registered in the United Kingdom and its Overseas Territories and Crown Dependencies had concealed more than £82 billion of corrupt Russian funds. This was only part of a bigger problem. The research corroborated what countless reports and exposés have shown in recent years: the role played by institutions and expertise in…

Mining Giant Pleads Guilty to U.K. Bribery Charges

Bribery
A subsidiary of the mining and commodities trading giant Glencore has pleaded guilty to seven counts of bribery in a London court. The firm also said it will pay more than $1bn (£800m) to resolve similar claims with the US and Brazil. The UK’s Serious Fraud Office said it had exposed “profit-driven bribery and corruption” across Glencore Energy UK’s oil operations in five African nations. The firm will find how much it must pay in fines at a sentencing in June. It previously set aside $1.5bn to cover the investigations it faced in the UK, US and Brazil. Glencore’s chairman…

Soldiers Arrested on Drug and Money Laundering Offences

Money Laundering
Six soldiers and a veteran have been arrested on suspicion of drug, money-lending and money-laundering offences, the Ministry of Defence has said. The MoD said six Irish Guards troops and a Coldstream Guardsman veteran were arrested by the Royal Military Police as part of a “planned operation”. The 1st Battalion Irish Guards are set to lead Thursday’s Trooping the Colour for the Queen’s Platinum Jubilee. The MoD said none of the soldiers under investigation would take part. A defence source confirmed to the BBC that items suspected to be drugs were seized in a raid at Mons Barracks in Aldershot…

Defining Cryptocurrency Regulation Important for the Industry to Grow

Digital Currencies, Regulation
A united government may make it easier for new crypto laws to be agreed upon, and to “follow the spirit of Biden’s executive order” in keeping the U.S. at the vanguard of innovation, Morgan Stanley (MS) said in a report Wednesday looking at the implications of midterm elections for the cryptocurrency sector. According to the bank’s public policy analysts, legislation concerning tech regulation, cryptocurrency, pricing of prescription drugs, tax increases and China competition will have varying chances of passage by the end of 2023, depending on the outcome of the November elections. Defining regulation for digital assets is important for…

EU Considers Blacklisting UAE After ‘Dubai Uncovered’ Leaks

Corruption, Sanctions
Following revelations of how criminals, sanctioned Russian oligarchs, and corrupt officials are big property investors in Dubai, European Parliament members have suggested that the United Arab Emirates should be blacklisted in the same manner as North Korea, Burkina Faso and Iran. Last week, OCCRP and investigative journalists from 20 other outlets uncovered how Russian politicians, sanctioned oligarchs, and criminals have poured their ill-gotten gains into luxury properties in Dubai. The ‘Dubai Uncovered’ investigation, based on a 2020 leak by the Center For Advanced Defense Studies (C4ADS) into the emirate’s housing market, has drawn calls from EU politicians for tougher anti-money…

UK Middlemen Paid £9.7m in Bribes to Saudis for Contracts

Bribery, Prosecutions
Two men funnelled bribes totalling millions of pounds to a Saudi prince and other high-ranking officials to secure lucrative commercial contracts, the opening day of a trial has heard. The Serious Fraud Office alleges that a total of £9.7m was paid to Prince Miteb bin Abdullah and a group of senior Saudi officials to land the contracts for a British subsidiary of the European aerospace group Airbus. Mark Heywood QC, for the prosecution, said British middlemen for years had regularly paid bribes to “highly placed” Saudis through offshore companies and Swiss bank accounts in what amounted to “deep corruption”. Jeffrey…

U.S. Says it Imposes Sanctions on Moscow Backed Iranian Oil Smuggling Network

Money Laundering, Sanctions
The United States on Wednesday imposed sanctions on what it described as a Russian-backed oil smuggling and money laundering network for Iran’s Revolutionary Guards’ Quds Force, even as Washington tries to revive nuclear deal with Iran. The U.S. Treasury Department said the network was led by current and former Quds Force figures, “backed by senior levels of the Russian Federation government” and included Chinese companies and a former Afghan diplomat. It had raised hundreds of millions of dollars for Iran’s Quds Force and Tehran’s Lebanese allies Hezbollah, and helped Tehran support proxy militant groups, Treasury said. The Quds Force is…

Global Crypto Regulatory Body Is Coming Soon

Digital Currencies, Regulation
A joint body tasked with coordinating crypto regulation globally is sorely needed and could become a reality within the next year, according to Ashley Alder, chair of the International Organization of Securities Commissions (IOSCO), an association of market regulators. Alder was speaking at an online conference organized by the think tank Official Monetary and Financial Institutions Forum (OMFIF). Alder, who is also the CEO of Hong Kong’s Securities and Futures Commission, said the growth of digital currency markets and their increasing connection to mainstream finance has made crypto a top focus area for regulators around the world. “Crypto has obviously…

Bankers Support Switzerland’s Decision not Change Banking Secrecy Law

Money Laundering
Swiss bankers defended on Tuesday the decision of a parliamentary commission not to strike down the controversial article 47 from the country’s banking secrecy law that has been criticized by the UN, journalists and human rights advocates as violating press freedom. After meeting last week to deliberate the subject, Swiss lawmakers chose not to touch the article of the Federal Act on Banks and Savings Banks that prescribes a prison sentence of up to three years and a fine for whoever discloses confidential banking information about a Swiss bank’s client. “From the point of view of the majority of the…

KPMG Hit by Latest in String of Fines Over Rolls-Royce Bribery Scandal

Bribery
KPMG UK is facing the latest in a litany of multimillion pound fines for failings in its supervision of the accounts of Rolls-Royce Holdings, the aircraft engine manufacturer. Sky News has learnt that the big four auditor could be hit with a roughly-£4.5m penalty as soon as this week over work dating back more than a decade. One source familiar with the situation said the £4.5m was expected to be discounted to reflect KPMG’s co-operation with the inquiry led by the Financial Reporting Council (FRC). The fine relates to the firm’s work on Derby-headquartered Rolls-Royce, which in 2017 paid more…

U.S. Issues Charges in First Criminal Cryptocurrency Sanctions Case

Digital Currencies, Prosecutions, Sanctions
The Justice Department has launched its first criminal prosecution involving the alleged use of cryptocurrency to evade U.S. economic sanctions, a federal judge disclosed Friday. In an unusual nine-page opinion, U.S. Magistrate Judge Zia M. Faruqui of Washington, D.C., explained why he approved a Justice Department criminal complaint against an American citizen accused of transmitting more than $10 million worth of bitcoin to a virtual currency exchange in one of a handful of countries comprehensively sanctioned by the U.S. government: Cuba, Iran, North Korea, Syria or Russia. In the ruling, the judge called cryptocurrency’s reputation for providing anonymity to users…

The Sanctioned Oligarch’s Son and a £160m London Property Empire

Sanctions
The son of a Russian billionaire facing sanctions for supporting the dictator who runs Belarus has been linked to a £160m portfolio of London properties. Said Gutseriev, a 34-year-old businessman with British and Russian nationality, appears to have spent years amassing a collection of at least seven properties in central London. They range from large office buildings in the City to a pair of £17m townhouses in south Kensington knocked together to make one residence. Said’s father, Mikhail Gutseriev, was blacklisted last year, by the EU in June and the UK in August, months after the violent repression of protests…

Money Lost to COVID Fraud and Error is More Than the 10 Biggest Heists in History Put Together

Fraud
The money lost to Covid fraudsters and civil service blunders is more than 10 times all the biggest heists in history combined, Labour analysis has shown. The Treasury has had to write off £11.8bn in public funds which were wrongly claimed by fraudsters under the various Covid support schemes, or lost by mistake. By contrast, the top 10 heists in British history amount to only £1.1bn in today’s terms when adjusted for inflation. Labour accused Rishi Sunak of a “great Covid robbery”. The Great Train Robbery of 1963 led to the loss of £2.6m, while the most lucrative heist of…

A Museum Could be in Breach of Sanctions if it Returns a Fabergé Egg to its Russian Oligarch Owner

Sanctions
The Victoria and Albert Museum is in possession of a Fabergé Egg belonging to a sanctioned oligarch. The ornament, owned by Viktor Vekselberg, is on loan to the London museum. The institution could end up breaching sanctions if it’s returned to Vekselberg, however. A UK museum, which is in possession of a Fabergé Egg belonging to a sanctioned Russian oligarch, could breach sanctions if it returns it to him. iNews reported the story first. Viktor Vekselberg acquired the very first Fabergé Egg – an elaborately decorated ornament – in 2004, according to The Art Newspaper. It was commissioned in 1885…

Britain Must Do More to Tackle Corruption in Politics and Finance, Lawmaker Says

Corruption, Regulation
Britain has lost its moral compass and must act to tackle “dirty money” and protect the integrity of its democracy, a senior opposition lawmaker said in a report published on Monday by King’s College London. Margaret Hodge, a Labour lawmaker for 28 years and former head of parliament’s Public Accounts Committee, said a culture of deregulation and light-touch enforcement had allowed financial malpractice to flourish and this was seeping in to politics. “Unacceptable behaviour is in danger of becoming commonplace,” Hodge, who chairs a cross-party parliamentary group on anticorruption and responsible tax, said in the report for the Policy Institute.…

EU Proposes New Rules to Confiscate Assets of Criminals and Oligarchs Evading Sanctions

Sanctions
Today, the Commission proposes a new Directive on Asset Recovery and Confiscation. It includes rules on asset recovery from tracing and identification, through freezing and management, to confiscation of assets. The Asset Recovery and Confiscation Directive proposes to modernise EU rules on asset recovery and confiscation by: Ensuring that financial investigations aimed at tracing illicit assets are swiftly launched in all complex criminal investigations against organised crime. Providing Asset Recovery Offices with the powers and information to swiftly trace and identify criminal assets, including by urgently freezing property. Establishing Asset Management Offices to ensure that frozen property does not lose…

SEC Charges Wells Fargo Advisors with Anti-Money Laundering Related Violations

Money Laundering, Prosecutions
The Securities and Exchange Commission today announced charges against Wells Fargo Advisors for failing to file at least 34 Suspicious Activity Reports (SARs) in a timely manner between April 2017 and October 2021. Wells Fargo Advisors, the St. Louis-based broker-dealer, has agreed to pay $7 million to settle the charges. According to the SEC’s order, due to Wells Fargo Advisors’ deficient implementation and failure to test a new version of its internal anti-money laundering (AML) transaction monitoring and alert system adopted in January 2019, the system failed to reconcile the different country codes used to monitor foreign wire transfers. As…

EU Plans to Stop Russians From Buying Property in Europe

Sanctions
An EU-wide ban on property transactions with Russian nationals has been added to the Commission’s sixth package of sanctions. In the proposal, the European Commission intends to stop property deals with Russian individuals, residents and entities — prohibiting the sale or transfer, directly or indirectly of ownership rights in property in the bloc. It is designed to apply to land and dwellings located “within the territory of the Union or units in collective investment undertakings providing exposure to such immovable property.” The latest EU action targets both the Russian state and oligarchs and for the first time specifically targets the…

UK Financial Conduct Authority Acts to Improve Financial Crime Issues at Challenger Banks

FCA, Financial Crime Controls
The U.K. Financial Conduct Authority has published the findings of its multi-firm review into financial crime controls at challenger banks. The FCA undertook the review in 2021 in response to the 2020 National Risk Assessment of money laundering and terrorist financing, which highlighted the risk that quick onboarding processes advertised by challenger banks could appeal to criminals. The FCA’s review revealed that technology is being used well to identify and verify customers quickly and that there are not many differences between the financial crime risks facing challenger banks and those posed to traditional retail banks. However, there are several areas…

US Commission Accuses Switzerland Of Hiding Russian Assets

Sanctions
The Commission for Security and Cooperation in Europe, otherwise known as the Helsinki Commission, has issued hard-hitting criticism of Switzerland’s perceived role in hiding Russian assets. “Long known as a destination for war criminals and kleptocrats to stash their plunder, Switzerland is a leading enabler of Russian dictator Vladimir Putin and his cronies. After looting Russia, Putin and his oligarchs use Swiss secrecy laws to hide and protect the proceeds of their crimes,” the body stated. The Commission’s hearing on Thursday heard testimony from Pieth, Miranda Patrucic, deputy editor in chief at the Organized Crime and Corruption Reporting Project and…

Stricter Controls on Lawyers, Accountants and Other ‘gatekeeper’ Professionals Who Enable Money Laundering

Money Laundering
STRICTER AML regulations and supervision must be placed on the professional “gatekeepers” who enable money laundering, the Council of Europe’s AML body said today. MONEYVAL also said governments need to step up their efforts and coordination to combat money laundering and terrorist financing by adopting stricter regulation and supervision of the crypto and virtual assets sector. The group called out “the specialised ‘gatekeeper’ professions, such as lawyers, accountants and other services providers who often help launderers” as requiring more oversight. MONEYVAL is the Council of Europe’s anti-money laundering and counter-terrorist financing body. The emerging virtual assets sector and the increasing…

Strikes at UK Financial Regulator Due to Start This Week

FCA
Unionized staff at the Financial Conduct Authority will mount the first strike in the chief UK financial regulator’s nine-year history this week over a dispute over pay and working conditions. Staff will go on strike on Wednesday and Thursday following a protracted battle with management over restructuring plans that Unite claims would amount to pay cuts for many employees. The industrial action is the first of a series, with further strikes earmarked for June and July, although fewer than 300 of the watchdog’s 4,000 workers are expected to take part this week. Unite disclosed last month that it had 640…

5 U.S. States Order a Metaverse Casino With Alleged Ties to Russia to Halt Sale of NFTs

NFTs, Sanctions
Regulators in five states simultaneously filed emergency orders Wednesday against a virtual casino they say has ties to Russia and that has been operating in the metaverse, a digital world where participants can interact with each other, purchase products and even gamble. State law enforcement officials say Flamingo Casino Club’s operators failed to disclose its Russian ties and claimed it had partnerships with legitimate businesses when it didn’t. The civil filing represents a new and coordinated effort by state regulators to police some of what is going on amid the explosive growth of the metaverse, where innovation and speculation have…

Fraud Scheme of at Least €440m in Italy Halted

Fraud
Italian and Austrian authorities have dismantled a massive fraud scheme set up by a criminal network that used Italian companies to simulate business leases and false tax credits. The perpetrators deprived the Italian authorities of at least EUR 440 million. With the help of Eurojust, approximately 90% of the proceeds have been recovered and 12 suspects have been arrested. The arrested suspects allegedly belong to an organised crime group (OCG) that defrauded the Italian State of at least EUR 440 million. The OCG used Italian companies to sell false tax credits, to simulate business leases in order to obtain COVID-19-related…