Author: gracechurchfcp

Britain’s Money Laundering Scandal Goes Back a Long Way

Money Laundering
The war in Ukraine has turned a lot of people’s attention to oligarchs in the UK. How did these guys all end up in London, seemingly owning half of Belgravia? In Butler to the World, Oliver Bullough offers an answer. I read his earlier work Moneyland slack-jawed at the blatant – and mundane – techniques employed to register UK Ltd companies through frontmen and use them to launder money. I thought the middle men would be glamorous and slick, not running a website from an office above a chip shop. In this work Bullough looks at the bigger picture: the…

Using AI to Fight Money Laundering

Money Laundering
The Fintech industry’s rapid growth and use of new technologies to meet the rise in demand for online services has brought with it increased levels of cyber crime. Criminals have taken advantage of the benefits digital banks offer to access money, launder illicit money and fund terrorism worldwide. The growth in technology for blockchain and digital payments provides new opportunities for criminals to launder funds at faster speeds and larger scales than they might have been able to previously. According to UK Finance, criminals stole a total of £753.9 million through fraud in the first half of 2021, an increase…

Six Steps Exchanges Can Take to Comply With Cryptocurrency Sanctions

Digital Currencies, Sanctions
With the Russian invasion of Ukraine ongoing and extensive sanctions being levied accordingly, cryptocurrency-specific designations may be close behind. Below, we outline six steps exchanges can take to strengthen compliance. 1) Collect Know Your Customer (KYC) information and screen it against sanctions listsAny cryptocurrency business should explore collecting KYC information from new users upon sign-up, recording information such as customer names, addresses, phone numbers, emails, and related documentation. As part of the KYC process, cryptocurrency businesses should screen this information against sanctions lists to refrain from doing business with any designated individuals, entities, or with sanctioned countries. Because each country…

EU Anti Money Laundering Supervision Improving But Not Yet Always Effective

Money Laundering, Terrorism
The EBA published today the findings from its assessment of competent authorities’ approaches to the anti-money laundering and countering the financing of terrorism (AML/CFT) supervision of banks. Since the EBA started those reviews in 2019 and strengthened its AML/CFT guidance, national supervisors have started to adopt meaningful reforms to improve their AML/CFT supervision, but the EBA found that significant challenges remain in important areas such as the identification and assessment of money laundering and terrorist financing (ML/TF) risks. The EBA found that most competent authorities in its sample were committed to strengthening their approach to AML/CFT supervision. Several competent authorities…

Microsoft Fired Employees After Allegations of Bribery in the Middle East and Africa, a Report Says

Bribery
A former Microsoft employee accused the tech giant of turning a blind eye on employees, subcontractors, and government operators engaging in bribery. The Wall Street Journal first reported the story. In an essay published Friday on Lioness, an outlet that documents stories from whistleblowers, Yasser Elabd brought to light accusations of Microsoft employees using local partner companies to help sell the company’s products to customers. In a statement sent to Insider, Becky Lenaburg, deputy general counsel at Microsoft said: “We believe we’ve previously investigated these allegations, which are many years old, and addressed them. We cooperated with government agencies to…

Jewellery Industry Accused of Silence over Russian Diamonds

Sanctions
Insiders say current sanctions do nothing to halt flow of Russian gems to the west because majority are exported rough and get reclassified in India In the photographs, Vladimir Putin stands with a faint smile on hisface. Behind him, the enormous cavern of a mine stretches out, the earth ringed red and ochre. In other photographs from his visit to the Siberian mining city of Mirny, the Russian president is pictured meeting local miners and inspecting one of the dark stones they cut from the earth. Soon, the rock in his hand will be swept into a vast and complex…

German Resort’s Rift Over Russian Oligarch Resonates Across Country

Sanctions
FRANKFURT — A German politician who mobilized a protest against a now-sanctioned Russian resident of his resort town has attracted a following, but also angry emails and a threatening phone call. This mirrors Germany’s ambivalence to becoming a sanctuary for wealth in a culture that cherishes privacy but that critics say has allowed the mega-rich to squirrel away assets in secrecy. And while Britain, France, Italy and Spain have seized yachts and other property since Russia’s invasion of Ukraine and the subsequent imposition of sanctions on influential Russians, Germany appears to have sat on its hands. “For years, Germany has…

Swiss Banks Hold More Than $200 Billion in Stashed Russian Cash

Sanctions
(Bloomberg) — Swiss banks may hold more than $200 billion of Russian wealth, the country’s banking lobby estimates, as sanctions shine a spotlight on the extent of Russian wealth stored in overseas vaults. Banks probably hold between 150 billion ($160 billion) and 200 billion Swiss francs of Russian client money in offshore accounts, according to the Swiss Bankers Association. Credit Suisse Group AG Chief Executive Officer Thomas Gottstein said earlier this week that Russian money accounted for about 4% of assets at the bank’s wealth management division. The country of 8.6 million inhabitants has long been attractive for wealthy Russians,…

We Were Leaked the Panama Papers. Here’s How to Bring Down Putin’s Cronies

Financial Crime
Seven years ago, an anonymous source who went by the name “John Doe” provided us with the data that became the Panama Papers – 2.6 terabytes of leaked documents from the Panamanian law firm Mossack Fonseca. The leak turned out to have quite an impressive Russian component. We found shell companies connected to Vladimir Putin’s judo friends, Boris and Arkady Rotenberg, to the oligarch Alisher Usmanov and the wife of the Kremlin spokesman Dmitry Peskov. But, most significantly, we stumbled across Sergej Roldugin, a professional cellist and godfather of Putin’s eldest daughter, who had a central role in a network…

Treasury Publishes National Risk Assessments for Money Laundering, Terrorist Financing, and Proliferation Financing

Money Laundering, Risk Assessments, Terrorism
WASHINGTON – The U.S. Department of the Treasury today issued the 2022 National Risk Assessments (NRAs) on Money Laundering (NMLRA), Terrorist Financing (NTFRA) and Proliferation Financing (NPFRA). These documents highlight the most significant illicit finance threats, vulnerabilities, and risks facing the United States. The United States is vulnerable to all three forms of illicit finance because of the size and sophistication of the U.S. financial system and centrality of the U.S. dollar in the payment infrastructure of global trade. These NRAs are the third iteration of the NMLRA and NTFRA since 2015 and second for NPFRA since 2018. They take…

Tencent Dives on Report of Record Fine for Money Laundering

Money Laundering, Regulatory Fines
Tencent Holdings Ltd. extended losses to close more than 10% lower after the Wall Street Journal reported it faces a record fine for violating Chinese anti-money laundering regulations. The People’s Bank of China found Tencent’s WeChat Pay had allowed the transfer of funds for illicit purposes such as gambling, the newspaper reported, citing unidentified people familiar with the matter. WeChat Pay was also judged non-compliant with other rules that required Tencent to identify users and merchants transacting on the platform, the Journal said. A probe into potential money-laundering would open a new front in Beijing’s sweeping crackdown on the internet…

Lack of System Tuning, Unsustainable Alert Backkigs Leads to $140 million USAA AML Penalty

Money Laundering, Regulatory Fines
Over the years, more and more attention has been drawn to banks and anti-money laundering failings, with news headlines hitting the mainstream, over the last decade hitting historic figures in the billions of dollars – just against one institution. Banks often include in their responses that such issues were “historic,” with the caveat they have since moved on and corrected the identified deficiencies, but from time to time, the failings have been found to be more recent – case in point, USAA Federal Savings Bank (USAA FSB). The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) and the Office of the…

Entire Former Board of Swedbank Estonia Suspected of Money Laundering

Money Laundering
TALLINN – The Office of the Prosecutor General has brought suspicions against the banking unit of Swedbank Estonia and its former heads of participating in money laundering exceeding 100 million euros, the daily Postimees writes citing the weekly Eesti Ekspress. Robert Kitt, who was a member of the management board of Swedbank in the period 2011-2019, told Postimees that he had followed the law in force and the recommendations given by the supervisory body in his activities during his time on the management board of Swedbank. He confirmed that he is aware of the prosecutor’s office’s suspicion. “I have received…

US Regulators Slap National Bank of Pakistan With $55m Fine

Money Laundering, Regulatory Fines, Terrorism
The National Bank of Pakistan has agreed to pay $55m in fines imposed on its New York branch by three US regulators. According to Reuters, the Federal Reserve Board, the Federal Reserve Bank of New York and the New York State Department of Financial Services recently announced the NBP will be fined the amount due to non-compliance and anti-money laundering violations. The National Bank of Pakistan’s shares dropped by 7.2% following the announcement. However, the bank said there were no findings of improper transactions or wilful misconduct and that it has substantially enhanced its compliance programme. The NBP is one…

Weak Money Laundering Laws Put Australia at Risk of Becoming a Haven for Russian Cash

Money Laundering
Australia’s lax money laundering laws mean the nation is at risk of becoming a haven for Russian cash belonging to oligarchs who are seeking to avoid sanctions over the war in Ukraine, experts say. The country is one of only three – along with Haiti and Madagascar – yet to commit to bringing lawyers, accountants and real estate agents under the umbrella of anti-money laundering and counter-terrorism finance laws (AML-CTF). Having failed to act on a promise it made eight years ago to bring the professions into the AML-CTF system, the government now faces a race against time to take…

New Zealand Moves to Crack Down on Corporate Secrecy After Pandora Papers

Money Laundering, Regulation
New Zealand has pledged to end corporate secrecy by establishing a public beneficial ownership registry. The government announced a new transparency bill this week to stop the abuse of locally-based, secretive companies by criminals. The legislative crackdown came in response to revelations made in the International Consortium of Investigative Journalists’ Pandora Papers investigation, the government said. The proposed law, to be introduced later this year, will require companies and limited partnerships registered in New Zealand to disclose the identity of the person who owns or controls them. “The Pandora and Panama papers highlighted some key vulnerabilities which need to be…

Proposals to Reduce the Liability Burden on CCO

Compliance
In the US, chief compliance officers can be held liable for their financial services firms’ failures to comply with regulations – whether they’re involved or not. In this article, we look at a framework proposed by the New York City Bar Association to help to reduce the burden on CCOs. “These career-ending enforcement actions discourage individuals from becoming or remaining compliance officers and performing vital functions that regulators stretched too thin would otherwise be unable to perform, particularly when other options, such as providing legal advice or becoming an outside compliance service provider or businessperson, involve less personal risk.” Framework…

Money Laundered Millions Seized in Jersey to be Sent to Kenya

Corruption, Money Laundering
Millions of pounds that was seized in Jersey from money laundering is being returned to Kenya in a world first. The £3million was confiscated in 2016 following the conviction of Jersey-registered company Windward Trading Ltd. for money laundering offences. The money originated in Kenya, and was being fed through the Jersey company. Despite the 2016 conviction of the company, two individuals from Kenya linked to the company are still awaiting trial. Now, Jersey has agreed to send the money back after Her Majesty’s Attorney General for Jersey signed an Asset Recovery Agreement (ARA) with the Kenyan government. The money will…

Deutsche Bank to Wind Down in Russia, Reversing Course After Backlash

Financial Crime
FRANKFURT, March 11 (Reuters) – Deutsche Bank (DBKGn.DE), which faced stinging criticism from some investors and politicians for its ongoing ties to Russia, said on Friday in a surprise move that it would wind down its business in the country. Deutsche joins the ranks of Goldman Sachs (GS.N) and JPMorgan Chase (JPM.N), which were the first major U.S. banks to exit after Moscow’s invasion of Ukraine. Those moves put pressure on rivals to follow. read more . Deutsche had resisted pressure to sever ties, arguing that it needed to support multinational firms doing business in Russia. But on Friday evening…

New Financial Sanctions Measures in Relation to Russia

Sanctions
Following the Prime Minister’s statement to the House of Commons on 22 February 2022, the UK announced a tranche of sanctions on Russia. The Prime Minister announced further measures on 24 February 2022 which are available on the Foreign, Commonwealth & Development Office website. If you require a licence to permit any activity which would otherwise be prohibited by sanctions regulations, you must contact the relevant department. We expect firms to have established systems and controls to counter the risk that they might be used to further financial crime and this includes compliance with financial sanctions obligations. Where the FCA…

U.S. Officials Fear Russian Money is ‘Entrenched’ in London and Warn ‘Leverage Against Putin Could be Lost’

Money Laundering
As the Western world waits with bated breath on a potential Ukraine invasion by Russian military, American officials have revealed their fears of ineffective economic sanctions against Russia. US State Department officials are believed to have expressed “dismay and frustration” at the British government’s perceived failure to tackle dirty Russian money sloshing around London. “The fear is that Russian money is so entrenched in London now that the opportunity to use it as leverage against Putin could be lost,” one US diplomatic official was reported as telling The Times. “Biden is talking about sanctioning Putin himself but that can only…

Pressure Mounts for Action Against ‘Enablers’ of Russian Regime

Money Laundering
The role of English law firms acting for powerful Russian clients has come under growing political scrutiny as the government prepares to announce long-delayed legislation against the flow of ‘dirty money’ to the UK. Writing in today’s Financial Times, Cabinet Office minister Andrew Griffith called on law firms to ‘go further, faster, wherever they can’ to ensure that sanctions bite. His comments followed claims that the government has received threatening letters from City law firms acting for clients facing sanctions following the Russian invasion of Ukraine. Foreign secretary Liz Truss briefed MPs over the weekend that law firms were holding…

Charity Urges Crackdown on £1.5bn Worth of U.K. Property Linked to Kremlin and Financial Crimes

Money Laundering
A charity has urged the British Government to fast-track measures to crack down on dirty money following the Prime Minister’s announcement of new Russia sanctions. Their remarks come after the prime minister announced sanctions on five Russian banks and three Kremlin-linked individuals earlier today. Analysis from Transparency International UK has identified at least £1.5 billion worth of UK property owned by Russians accused of financial crime or with links to the Kremlin. Most of this property is held by secretive offshore companies. The true figure for illicit wealth invested in the UK is likely to be far higher, with almost…

Boris Johnson Promises U.K. Property Register to Expose Kleptocrat Money

Money Laundering, Regulation
As the government acts to squeeze Russian oligarchs in the wake of Vladimir Putin’s invasion of Ukraine, Boris Johnson has promised to rush forward plans for a new public register, revealing the ultimate owners of properties across the UK. The government had previously failed to act, despite the vast offshore leak known as the Pandora Papers revealing last year the details of 1,500 UK properties owned through secretive offshore companies, some of them connected to senior Russian figures. The data showed that the family of Russian oligarch Mikhail Gutseriev – who was placed under sanctions by the UK, EU and…

UK Second in Money Laundering Hall of Shame

Money Laundering
The second-highest amount of money is laundered each year in the UK, with an estimated £88bn worth of money cleaned by criminals annually. Only the US sees more, with £216.5bn laundered annually, while France (£54.5bn), Germany (£51.3bn) and Canada (£25.6bn) also rank among the top five countries in terms of value of money laundered. The figures, from identity verification software maker Credas Technologies, put together using OECD data, also revealed that about £1.8tn is laundered globally each year, some 3% of total GDP. Money laundering, and its links to organised crime, is a serious global problem that banks find themselves…

‘Credit Suisse Papers’ Leak Shows How Lender Banked Criminals and Tyrants with Little Due Diligence

Due Diligence, Money Laundering
TROUBLED Switzerland banking giant Credit Suisse was thrown into further crisis today as a massive data leak revealed a client list involved in money laundering, torture, drug trafficking and corruption. The data dump shows up massive failures of due diligence by Credit Suisse despite repeated promises by the bank that it would end relationships with dodgy clients and illicit funds. The Suisse Papers also shed light on one of the world’s largest and most secretive financial centres, based out of Geneva and Zurich, and grown used to operating in the shadows. Swiss financial institutions manage about 7.9tn CHF (€7.56tn) in…

Leak Exposes Credit Suisse’s Criminal Clients as AML Whistleblower Law Awaits Reform

Money Laundering, Whistleblowing
A whistleblower recently leaked data from Credit Suisse revealing that the bank opened accounts for and served numerous individuals with criminal ties, including sanctioned businessmen and human rights abusers. The leaked data includes information on more than 18,000 bank accounts, collectively holding more than $100 billion. It has increased scrutiny of the Swiss banking system and has renewed calls for stronger anti-money laundering laws. According to the New York Times, “among the biggest revelations is that Credit Suisse continued to do business with customers even after bank officials flagged suspicious activity involving their finances.” The Times reports that these customers…

‘Swiss Secrets’: What Would E.U. Blacklisting Mean for Switzerland?

Money Laundering
The Swiss Secrets scandal threatens to shift the country back to the European Union’s blacklist – but what does that mean for Switzerland? In view of a recent data leak showing that Credit Suisse bank accepted money from illicit sources, the European People’s Party (EPP) has called on the EU to “re-evaluate Switzerland as a high-risk money-laundering country” and add it to the list of nations at high risk for financial crime. Credit Suisse bank held tens of billions of euros of dirty money for decades, a new cross-border media investigation claimed Sunday. The investigation was coordinated by the Organised…

Credit Suisse Faces Money Laundering Charges in Bulgarian Cocaine Traffickers Trial

Drug Trafficking, Money Laundering
ZURICH, Feb 7 (Reuters) – Credit Suisse faced charges in a Swiss court on Monday of allowing an alleged Bulgarian cocaine trafficking gang to launder millions of euros, some of it stuffed into suitcases. In the first criminal trial of a major bank in Switzerland, Swiss prosecutors are seeking around 42.4 million Swiss francs ($45.86 million) in compensation from Credit Suisse (CSGN.S). They say the country’s second-biggest bank and one of its former relationship managers did not take all necessary steps to prevent the alleged drug traffickers from hiding and laundering cash between 2004 and 2008. “Credit Suisse unreservedly rejects…

Why the U.K. Needs to Accelerate its AML/CTF Efforts on Crypto Assets

Digital Currencies, Money Laundering, Terrorism
As money-laundering risks rise with the increased adoption of cryptocurrencies, the UK needs to accelerate its response to maintain its future as a centre for financial innovation. It’s been two years since the UK rolled out its anti-money laundering and countering the financing of terrorism (AML/CFT) regime for cryptoassets. And there’s been one clear lesson in that time: getting it right isn’t easy. As the Treasury Select Committee report on Economic Crime (TSC Report) launched on 2 February noted, ‘registration of crypto-asset firms for money laundering has been slow’, leading the Committee to urge quicker progress. However, UK progress should…

Estate Agents See 64% Rise in AML Registrations

Money Laundering, Terrorism
With the property market long being a target for money laundering, new data reveals that UK estate agents are stepping up to the challenge and have seen the largest annual increase in the number of newly AML registered businesses. The government’s latest risk assessment of money laundering and terrorist financing increased the risk score for money laundering within the UK property market to high, with the specific risk to both estate and letting agents also increasing. Despite this risk, HMRC revealed that estate agents had been slow out the blocks when it came to AML compliance, estimating back in 2019…

Court Approves £5.6m Seizure Over Money Laundering

Money Laundering
The National Crime Agency can seize £5.6m from a sophisticated global money laundering scheme involving UK companies, a court has ruled. Financial investigators can take the money from the London-based family of Javanshir Feyziyev, an MP in the Azerbaijan parliament. The NCA had hoped to seize over £15m but hailed Monday’s ruling a success. It comes as campaigners criticise the government for delaying new laws to target allegedly dirty money in the UK. The investigation was launched after the exposure of a corruption scandal dubbed the Azerbaijani laundromat. The NCA pored over thousands of leaked documents from Den Danske Bank,…

Fraudster in £100k Diamond Ring Who Made Millions Out of Others’ Misery

Fraud
Lorraine McLaren and her husband Edwin were seen as “saviours” to the cash-strapped homeowners who turned to them in desperation when financial difficulties struck. But really Edwin used his financial know-how to dupe unsuspecting victims into signing over their houses, which were then sold from under them. And Lorraine benefited from her husband’s fraudulent scheme to live it up in a £762,000 home in Bridge of Weir, Renfrewshire, with lavish holidays in Dubai and private schools for her kids. Shameless Lorraine even splashed out on a ring worth £100,000 while her victims were left homeless. The duplicitous pair were only…

Kazakh Ex-Dictator Used U.K. Company to Protect Empire

Corruption
Kazakhstan’s former dictator used the UK to help safeguard a multibillion-dollar business empire built during his three-decade rule, the Bureau of Investigative Journalism and the Telegraph can reveal. Foundations controlled by Nursultan Nazarbayev, a notorious autocrat who was in office until 2019, controlled $7.8bn in assets via Jusan Technologies. One of the company’s subsidiaries, a Kazakh bank, received a multi-billion dollar state bailout and went on to hand a dividend to its parent. It is registered in the UK, where it has just one employee. Documents from October 2021 showed Jusan Technologies at the centre of a sprawling corporate operation…

No 10 Pressured Me to Drop Anti-Money Laundering Measures, Says Ex-Minister

Money Laundering, Regulation
A former Conservative minister, once at the heart of efforts to clamp down on money laundering in London, has revealed that during Theresa May’s premiership, No 10 “leant on him” when he tabled amendments to introduce a public register of overseas property owners. Lord Faulks said he had first tried to put the register into the criminal finances bill in 2017 and then again into a government bill on money laundering in 2018. He had described the overseas ownership of “dirty money” in London as an obscenity. Faulks, a distinguished barrister and now an independent peer, told the Guardian he…

HMRC Seizes NFT for First Time in £1.4m Fraud Case

Digital Currencies, Fraud
The UK tax authority has seized three Non-Fungible Tokens (NFT) as part of a probe into a suspected VAT fraud involving 250 alleged fake companies. HM Revenue and Customs (HMRC) said three people had been arrested on suspicion of attempting to defraud it of £1.4m. The authority said it was the first UK law enforcement to seize an NFT. NFTs are assets in the digital world that can be bought and sold, but which have no tangible form of their own. The digital tokens, which emerged in 2014, can be thought of as certificates of ownership for virtual or physical…

Online Investment, Call Center Scams Prey on Desire for ‘Easy’ Money

Fraud
Fake it till you make it? Financial fraudsters are setting up fake websites and posing as financial consultants from call centers. Late last month, Bulgarian police took down a financial crime ring that was responsible for stealing at least €10 million. Experts say that this could be happening here, too, targeting financial customers. According to CSC’s Domain Security Report, “Internet fraud is typically targeted, using a variety of threat vector forms, and is a systemic issue,” said Ihab Shraim, chief technology officer, Digital Brand Services at CSC. “These threat vectors start with a fraudulent domain containing a look-alike brand name,…

U.K. Seizes Millions from Lawmaker Linked to the Azerbaijani Laundromat

Money Laundering
The U.K. authorities have seized from an Azerbaijani lawmaker 5.6 million pounds (US$7.56 million) derived from a sophisticated international money laundering scheme that was revealed by the OCCRP and its partners in 2017, the National Crime Agency (NCA) said in a statement on Monday. Based on the results of an investigation conducted by the agency, a court ruled that the money can be seized from six bank accounts belonging to Javanshir Feyziyev, his wife, one of his children and a nephew. Feyziyev is a serving member of Azerbaijan’s Parliament, Chair of the UK-Azerbaijan All Parliamentary Cooperation Committee, and Co-chair of…

GMP Returning Millions to Crypto Currency Scam Victims

Digital Currencies, Fraud
The case marks a rare achievement for law enforcement in returning cryptocurrency funds to victims who have been duped by an international scam. More than £4m has been returned to the victims of a global cryptocurrency scam after specialist officers in Manchester acted on intelligence to track down two suspects – and police say £7m is yet to be claimed. A 23-year-old man and a 25-year-old woman have been arrested for fraud and money laundering offences after Greater Manchester Police (GMP) received intelligence that those running the scheme had been in the city for a limited time. In all 150…

UK Treasury Committee Calls for government Action on Fraud and Scam Surge

Fraud
A new report by the UK’s Treasury Select Committee has called on the government to work harder to tackle the ‘growing fraud epidemic’ in the UK. The report – which focuses on Economic Crime – urges the government to legislate against online fraudulent adverts and to consider whether online giants should reimburse those who fall victim to scams on their platforms. The Committee also called on the government to make reimbursement for victims of authorised push payment fraud mandatory. Amongst a number of recommendations, the report called on law enforcement to be resourced appropriately to tackle the scale of the…