Month: August 2022

Wise hit with AML Fine in Dubai

Regulation, Regulatory Fines
London-listed fintech firm Wise has been slapped with $360,000 (£307,801) fine by Abu Dhabi regulators today after a series of failures in its anti-money laundering controls. The Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) announced today it had fined the money-transfer firm after finding it did not “establish and maintain adequate AML systems and controls” to ensure full compliance with its AML obligations. In its charge sheet against Wise, the regulator said that it had failed to track and verify the source of funds on customers it had identified as high risk, as well as failing…

U.K. at Risk of Joining Global Anti Corruption Partnership ‘List of Shame’

Bribery, Corruption
The Government has been warned it is on the brink of joining three other countries on a “list of shame” for repeatedly failing to meet the requirements set out by a global anti-corruption body co-founded by the UK. The Government was informed it has for the third time in a row fallen short of minimum requirements in its action plan to boost transparency, as set out as a condition of membership by the Open Government Partnership (OPG). In a letter to the Cabinet Office dated August 2, seen by PA news agency, OPG chief executive Sanjay Pradhan said the Government…

CoinSwitch Cooperating with Financial Crime Agency Probe

Digital Currencies, Financial Crime
India’s top crypto app CoinSwitch is cooperating with the national financial-crime agency, whose agents searched its offices this week to find out about its business model and user-onboarding processes, its CEO told Reuters on Saturday. CoinSwitch, valued at $1.9 billion, says it is the largest crypto company in India, with more than 18 million registered users. The firm is backed by Andreessen Horowitz, Tiger Global and Coinbase Ventures. Ashish Singhal, speaking for the first time publicly about Thursday’s search, said his company was engaging with the Indian Enforcement Directorate’s unit in the tech hub Bengaluru on functioning of its crypto…

USA Financial Crime Dashboard 2022 by FCN

Threat Assessment
The USA is faced with threats the size and scale of which very few other countries face. Whether due to its economic size, population, wealth, levels and breadth of international trade and its importance as both a financial centre as well as the US dollar as a global currency, the US is a money laundering centre, with hundreds of billions of dollars in financial crimes generated domestically each year. Foreign illicit funds destined for the US to invest in its currency, its securities markets or real estate, or as a transit country, for example trade via correspondent banking, the US…

Former U.S. Congressman from California Arrested and Charged with Fraud

Fraud, Prosecutions
A former congressman from California was charged with multiple fraud schemes, the Justice Department announced Tuesday. Terrence John “TJ” Cox, 59, is charged with 15 counts of wire fraud, 11 counts of money laundering, one count of financial institution fraud and one count of campaign contribution fraud, according to the Justice Department.  He could face a maximum of 20 years in prison and a $250,000 fine for wire fraud and money laundering if he is convicted. In addition, he could face a maximum of 30 years in prison and a $1 million fine for wire fraud and five years and…

Germany Plans New Financial Crime Authority in Bid to Tackle Money Laundering

Money Laundering, Regulation
Germany wants to create a new financial crime authority that would bundle several fragmented competencies, including sanctions enforcement, said a finance ministry paper on Tuesday. There are currently more than 300 supervisory bodies across Germany, a figure the finance ministry would like to reduce. With the new authority, the finance ministry hopes to make it easier to tackle complex international money laundering cases, which have long been a weak spot for the country. “We need to do better in many areas,” said a government representative, referring to the fight against money laundering. The current FIU unit, which receives suspicious activity…

Dutch Authorities Arrest Man for Facilitating Money Laundering’ Through US-Sanctioned Tornado Cash

Digital Currencies, Money Laundering, Sanctions
Police in the Netherlands have arrested a 29-year-old man in Amsterdam as the “suspected developer” of US-sanctioned crypto mixing service, Tornado Cash. In a statement, the Fiscal Information and Investigation Service (FIOD) said the man arrested was suspected of involvement in “concealing criminal financial flows” and “facilitating money laundering” through the mixing of cryptocurrencies through Tornado Cash. The man is due to be brought before a judge later today, while the FIOD have warned that multiple arrests have not been ruled out. The FIOD has also said that advanced technologies such as Tornado Cash mixers that “may facilitate money laundering”…

Dutch City of The Hague Seeks Exemption from E.U. Sanctions Against Russia

Sanctions
The Dutch city of The Hague on Thursday said it would ask for a temporary exemption of EU sanctions against Russia, as it struggles to find a replacement for its contract with Russian gas supplier Gazprom in time. Sanctions imposed by the European Union against Russia following its invasion of Ukraine order governments and other public bodies to end existing contracts with Russian companies by October 10. For The Hague, this means it has to find a new supplier of gas to replace its existing agreement with Gazprom. The city said it held an EU-wide tender in June and July,…

Canberra Lawyer Ben Aulich was Hoping to Reap Millions from Money Laundering Plan

Money Laundering, Regulation
Canberra lawyer Ben Aulich and accountant Michael Papandrea will continue to resist being put on trial on conspiracy to launder money after losing a bid to have their case heard in the ACT Magistrates Court. Both have been charged with conspiracy to launder money. Mr Aulich faces an alternative charge of recruiting others to engage in criminal activity. Efforts to keep the case in the lower court failed after prosecutor Mark Tedeschi told the court it didn’t have jurisdiction to hear the case, and the charges should be sent to the ACT Supreme Court for trial. “It would be hard…

Former Detroit Cop Who Led Integrity Unit Pleads Guilty in Bribery Conspiracy

Bribery, Prosecutions
Former Detroit Police Lieutenant John F. Kennedy, who previously supervised the department’s integrity unit, pleaded guilty Wednesday to conspiring with another officer to commit bribery, according to the United States Attorney’s Office. Kennedy, 57, of Rochester Hills, was accused of bribery as part of a broader federal investigation into public corruption involving Detroit city government officials and the towing industry. Initially charged with three counts bribery and one count of conspiracy, Kennedy and former Detroit Police Officer Daniel Vickers were accused of teaming up in May 2017 and began accepting cash, cars, car parts, car repairs and other valuables from…

UAE: Priority Remains to Detect, Investigate and Understand Money Laundering and Terrorist Financing

Money Laundering
The Executive Office of Anti-Money Laundering and Counter Terrorism Financing met on Thursday to conclude a review on progress in the first half of 2022. The highlights of the review included the signing of five new international judicial cooperation agreements by the UAE with the United States, Russia, Netherlands, Denmark, and Italy. There have been significant AML/CFT enforcement actions Hamid Al Zaabi, Director General, said: “We have a clear agenda for combating illicit finance and preserving the integrity of the global financial system. It is anchored in embedding the institutional capabilities set out in the UAE’s National Risk Assessment, National…

Make your bed and lie in it: Man sentenced for money laundering after cash stash found under bed

Money Laundering
A man has been sentenced for money laundering after police found him in possession of £280,000, including a quarter of a million pounds stashed in a drawer under a bed.Lin Guo, 32, of Bywell Place, Canning Town, London, previously pleaded guilty to two counts of money laundering. He was sentenced to two years in prison, suspended for 18 months, at Inner London Crown Court on Thursday 11 August 2022. Guo was also ordered to complete 200 hours of unpaid work within 12 months. Detective Inspector Mark Forster, from the City of London Police, said:“Guo portrayed himself as an innocent person…

What the UK’s updated anti-money laundering rules mean for the art market

Art Dealers, Art Market, Money Laundering
For those in the art market currently spending August wondering how best to navigate the opaque waters of UK anti-money laundering (‘AML’) legislation, this year the beach reading is slightly cheerier. Arguably, the scope of those participants in the art market who are regulated for AML is not as wide as once thought, and the statutory obligations to conduct Customer Due Diligence (‘CDD’) are potentially not as onerous as anticipated. A year ago, my article on anti-money laundering measures in the art market focused on the recent risk assessment published by the government. It then seemed too soon to see…

New register to crack down on dirty money and corrupt elites in UK goes live

Money Laundering
A first of its kind register, designed to root out corrupt oligarchs and elites attempting to hide ill-gotten gains through UK property, has come into force. The Register of Overseas Entities will require anonymous foreign companies owning or seeking to buy UK land to reveal their true owners, ensuring criminals cannot hide behind secretive chains of shell companies. The reforms will support government efforts to root out Russian oligarchs and kleptocrats using UK land to hide illicit wealth. From today, any foreign company wishing to buy UK property will have to identify its beneficial owner and present verified information to…

Lee Jae-yong: Why South Korea just pardoned the Samsung ‘prince’

Corruption
Samsung heir Lee Jae-yong – convicted of bribery and embezzlement in 2017 – has been granted a special presidential pardon.One of South Korea’s most powerful white collar criminals, Lee was twice imprisoned for bribing a former president. South Korea’s government justified the move, saying the de-facto leader of the country’s biggest company was needed back at the helm to spearhead economic recovery post-pandemic. This marks another swing in a struggle over how the country is run that has raged since mass protests took over Seoul six years ago and ousted a president from office.Lee’s crimes were directly tied up in…

Companies House plans digital ID verification

Regulation
Companies House is developing a new digital identity verification process to prevent people registering companies for illegal purposes. Chief executive Louise Smyth referred to the plan in a blogpost, published to coincide with the release of the agency’s corporate plan for 2022-23, saying that anyone setting up, running, owning or controlling a company in the UK will need to provide assurance they are who they claim to be. A spokesperson for Companies House said an individual will have to verify their identity, either directly or through an agent, by linking themselves with an authorised photo ID. They will take photographs…

Insider dealing occurs in 10% to 25% of cryptocurrency listings

Digital Currencies, Market Abuse
According to a recent study conducted by the University of Technology Sydney, researchers estimated that insider trading occurs in 10% to 25% of cryptocurrency listings. In deriving the conclusion, researchers first sampled 146 token listing announcements on cryptocurrency exchange Coinbase between Sept. 25, 2018 and May 1, 2022. Afterward, researchers examined the price movements of the sampled tokens in the time interval of 300 hours before Coinbase listing announcements up until 100 hours after the announcement, on various exchanges. The hypothesis was that if insider trading was involved, tokens that were also available to trade on decentralized exchanges, or DEXs,…

Estate Agents failing foul of Money Laundering Regulations

HMRC, Money Laundering
HM Revenue & Customs (HMRC) recently published a list of firms that have received penalty notices for failure to meet their anti-money laundering (AML) obligations, and almost half were in the property sector. In a list of 79 firms that had breached AML regulations between April and December last year, more than 30 were estate agents, commercial property firms, valuers and auction houses, meaning property firms accounted for almost half (44%) of all AML breaches during that time period. Why are HMRC clamping down on estate agents? The property market is one of the most vulnerable sectors in the UK…