Corruption and COVID-19 worsening democratic backsliding The 2020 Corruption Perceptions Index (CPI) released today by Transparency International reveals that persistent corruption is undermining health care systems and contributing to democratic backsliding amid the COVID-19 pandemic. Countries that perform well on the index invest more in health care, are better able to provide universal health coverage and are less likely to violate democratic norms and institutions or the rule of law. Read the report “COVID-19 is not just a health and economic crisis. It is a corruption crisis. And one that we are currently failing to manage,” Delia Ferreira Rubio, Chair of Transparency… Read More
Goldman Sachs’ chief executive David Solomon will get a $10m (£7.3m) pay cut for the bank’s involvement in the 1MDB corruption scandal. 1MDB was an investment fund set up by the Malaysian government that lost billions due to fraudulent activity. The global web of fraud and corruption led to a 12-year jail term for Malaysia’s ex-prime minister Najib Razak which he is appealing. Goldman Sachs called its involvement in the scandal an “institutional failure”. Goldman Sachs helped raise $6.5bn for 1MDB by selling bonds to investors, the proceeds of which were largely stolen. Prosecutors alleged that senior Goldman executives ignored… Read More
As we near the end of one of the toughest years for people and businesses in decades, we take a look back at some of the biggest happenings in the world of financial crime, corruption and the laws in place to stop it. 1. Cryptocurrency: the way of the future2020 has seen governments across the world tighten their grip on virtual assets. They were once seen as an easy pathway to launder money, but this year, the trend accelerates away from that. This month, France announced sweeping new KYC measures for all crypto companies operating within its borders. Registration will… Read More
President Vladimir Putin’s former son-in-law purchased $380 million worth of shares in Russia’s top petrochemicals company for $100 after marrying the president’s daughter, according to a report by the iStories investigative outlet. Kirill Shamalov acquired 3.8% of petrochemicals producer Sibur through a web of offshore companies months after marrying Katerina Tikhonova in February 2013, iStories reported, citing private emails obtained through a massive data breach. Multiple media reports have identified Tikhonova as the younger of Putin’s two daughters. Shamalov previously estimated Sibur’s value at $10 billion, meaning that the $100 he had paid was 3.8 million times below market value.… Read More
Apple’s head of global security has been indicted on felony charges for allegedly offering bribes to California police officers in exchange for concealed firearms licenses, the Santa Clara district attorney’s office announced in a press release published on Monday. According to an indictment issued by a grand jury, Thomas Moyer, 50, is accused of offering to donate 200 iPads worth roughly US$70,000 to the local police force in exchange for four licenses that are required for individuals looking to carry a gun without revealing it. The deal was apparently “scuttled at the eleventh hour” last year, when police officers became… Read More
Police in Europe cracked down on the illegal arms trade across the continent in two separate operations that saw 18 arrests, dozens of objects raided, nearly 200 firearms and millions in assets seized across the continent. Spanish authorities arrested seven suspects, seized 18 properties worth about 10 million euro (US$11.8 million) and froze over 50 financial products from a large organised crime group that transported armaments as large as tanks across the Mediterranean, and even once managed to break a compatriot out of a Greek prison. “The criminal network, made up of Latvian, Spanish and Ukrainian members, illegally transported Russian… Read More
SFO secures £1.2m following investigation into West London property linked to Brazilian bribery scandal
The SFO has today secured £1,198,424.78 from Julio Faerman, the owner of a £4.25m luxury apartment in West London which the SFO suspected to have been partly purchased with the corrupt funds of its owner’s criminal conduct. The Brazilian national was implicated in Brazil’s ‘Operation Car Wash’, which uncovered systematic bribery to win contracts from the Brazilian state oil company Petrobras. While under investigation by Brazilian prosecutors, Faerman admitted paying bribes to win contracts for the Dutch company SBM Offshore NV, for whom he acted as an agent. He is subject to a co-operation agreement with the Brazilian prosecuting authorities,… Read More
Basil Al Jarah has today been sentenced to three years and four months’ imprisonment for paying in excess of $17m in bribes to dishonestly secure approximately $1.7bn worth of contracts in post-occupation Iraq. Al Jarah, Unaoil’s former Iraq partner, conspired with others to pay millions of dollars in bribes to public officials at the South Oil Company and Iraqi Ministry of Oil. These bribes secured contracts for Unaoil and its clients to construct oil pipelines, offshore mooring buoys in the Persian Gulf, and other infrastructure projects, collectively worth just over $1.7bn. These contracts formed part of the Iraqi Ministry of… Read More
The U.K. tax authority is indicating its intention to enforce legislation and investigate corporations for failure to prevent tax evasion. Mukul Chawla QC and Kate Ison of Bryan Cave Leighton Paisner LLP review the current status of inquiries and discuss what action organizations need to take to ensure their procedures are robust and compliant. The focus by HM Revenue & Customs (HMRC) on organizations, under the Criminal Finances Act 2017, for the corporate offense of failure to prevent tax evasion, appears to be making steady progress. The number of investigations and inquiries that HMRC is currently undertaking, and the wide… Read More
What are the repercussions if a financial services firm is found guilty of facilitating tax evasion?
The offence of failure to prevent the facilitation of tax evasion (also known as the Corporate Criminal Offence or CCO) was introduced with great fanfare following the government initiative; ‘No Safe Havens’, which was part of an international initiative to increase tax transparency. As of 31 July 2020, HMRC announced that they had 10 CCO investigations open and a further 22 ‘opportunities under review’, meaning that HMRC are considering whether to open an investigation. Within these 32 investigations or ‘opportunities’, HMRC have disclosed that over a third relate to businesses within the financial sector. Businesses in the financial sector are… Read More
The bank at the center of Europe’s worst ever money laundering scandal has yet to fully address the corporate culture issues that led it astray in the first place. That’s according to the watchdog that oversees Danske Bank A/S. Denmark’s biggest bank spent years locked in a top-down hierarchy that left its management cut off from people further down the organization, according to Jesper Berg, the director general of the Danish Financial Supervisory Authority. “You go from a very hierarchical institution to an institution where staff needs to flag mistakes and speak up more,” he said in a phone intervie “They… Read More
Westpac and AUSTRAC have today agreed to a 1.3 billion dollar proposed penalty over Westpac’s breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act). Westpac and AUSTRAC have agreed that the proposed penalty reflects the seriousness and magnitude of compliance failings by Westpac. The Federal Court of Australia will now consider the proposed settlement and penalty. If the Federal Court determines the proposed penalty is appropriate, the penalty order made will represent the largest ever civil penalty in Australian history. In reaching today’s agreement, Westpac has admitted to contravening the AML/CTF Act on over 23 million occasions, exposing Australia’s… Read More
This article from the Organized Crime and Corruption Reporting Project (OCCRP) and Sweden’s Sveriges Television (SVT) is part of an investigation in which Courthouse News Service and NBC News are partners. By all outward appearances, Hatam Khatoun Nema was a small-time money changer working from a nondescript office in Järfälla, a workaday Stockholm suburb. In reality, the Swedish-Iranian businessman ran an obscure Hong Kong company, H M E A CO., LIMITED, that laundered hundreds of millions of dollars through a web of shell companies and businesses stretching from Singapore to Panama. A major customer of Nema’s operation was the Islamic Republic of Iran. Between… Read More
Lori Loughlin, star of beloved US sitcom Full House, has been given a two-month prison sentence for paying $500,000 in bribes to get her daughters into the University of Southern California. Her husband, fashion designer Mossimo Giannulli, will spend five months in prison for the same “breathtaking fraud”, a judge ruled. Giannulli was ordered to pay a $250,000 fine and do 250 hours of community service, while Loughlin will pay $150,000 and do 150 hours. Prosecutors said Giannulli deserves a tougher sentence because he was “the more active participant in the scheme,” while Loughlin “took a less active role, but was nonetheless… Read More
Greg Lindberg, the billionaire businessman at the heart of one of North Carolina’s worst government corruption scandals, will spend more than seven years in prison, a federal judge ruled Wednesday in Charlotte. U.S. District Judge Max Cogburn also ordered Lindberg to pay a $35,000 fine and placed him on three years’ probation for his scheme to bribe Insurance Commissioner Mike Causey with up to $2 million in campaign contributions. Eventually, Lindberg, one of the state’s largest political donors who wrote checks to both parties, funneled $250,000 earmarked for Causey through the state Republican Party, an illicit transaction handled by the party’s… Read More
A court in Malaysia has sentenced former PM Najib Razak to 12 years in jail after finding him guilty on all seven counts in the first of several multi-million dollar corruption trials.
Argentina Confronts its Multi-Billion Dollar Offshore Wealth Problem (Organised Crime and Corruption Reporting Project)
As Argentina has been renegotiating its US$65 billion debt with foreign creditors, it is also grappling with the fact that up to six times that amount is believed to be held by its citizens and companies offshore.
A US think tank claims that poor enforcement has turned Dubai into a hotbed of dodgy dealings by allowing the emirate to serve as a major crossroad for gray networks and international finance.