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Money Laundering

It's bizarre. A press release received today headed "Attorney General Xavier Becerra Announces Settlement With Western Union For Wire Fraud Scams, Encourages Victims to Come Forward" refers to a case that the US Department of Justice announced settled on 19th January this year under the headline "Western Union Admits Anti-Money Laundering and Consumer Fraud Violations, Forfeits USD586 Million in Settlement with Justice Department and Federal Trade Commission." In the DoJ announcement it says that the California settlement is part of the overall deal. However, there is some interesting stuff...

BIScom Subsection: 

In the past 25 years or so, the level of professionalism in the solicitors branch has fallen dramatically as thieves, vagabonds, chancers and businessmen, "right-on" campaigners and the barely literate have taken over the once proud profession. But there have, generally, been beacons that remind us what the Profession shoulda, coulda, woulda become if the correct decisions had been made by government and the self-regulatory bodies that control it. One of those has always been Clyde & Co. How, then, has this (in City terms) small, highly professional outfit, ended up before the Solicitors Disciplinary Tribunal and the firm, and three partners, being fined? And what lessons are there for other law firms? (updated)

Yes, yes, yes, we all know: HSBC is officially a UK bank except we all know it isn't. Not really. Yes, it has a big office in London and because of Stock Market rules its big bosses all have desks there but in truth, HSBC is still what it says on the tin. Even the Shanghai bit is coming back into use. So when HSBC in Hong Kong announced that it is starting to collect more detailed Know Your Customer information, it's good to take notice. And one reason it's good to take notice is that almost every other bank in the world is going to have to follow the HSBC lead as Compliance/Risk Management decisions inform business direction. And if they don't, they face appearing on a new OECD blacklist, an OFAC list and many more.

It's good when some novel conduct comes up: it helps FCROs and others avoid terminal boredom. One that's appeared in Australia might not be new but it's uncommon enough to be interesting - and it's carefully designed to be difficult to spot as it takes place within the ordinary course of business. For those in "all-crimes" jurisdictions, it's something new to try to watch out for.

Case Summary: 

An officer with US Customs and Border Protection was engaged to check incoming and outgoing international mail for breaches of various laws. That was a golden opportunity for a criminal.

Type of conduct: 
Other financial crime

In 2015, the UK's Financial Conduct Authority fined Barclays Bank its then largest penalty for failings in its financial crime management obligations. Barclays had been one of the first major banks to install company-wide money laundering management software. But it doesn't help when those within the bank don't feed it the information it needs.

PART One of this article appears at http://www.pleasebeinformed.co...

In its Conclusion the Joint Opinion implies a monumental failure of the European machine. And it has little to say beyond that already known and widely not acted upon.

Around the turn of this decade, Nigel Morris-Cotterill had surprisingly open access to the Embassy of North Korea in Kuala Lumpur. His experiences are instructive and fascinating.

When India decided to remove, without warning, two large value notes from circulation and cancel their legality, Economists chugged their drinks and were delighted that India would be pulling back into some kind of order the unsustainable position that the vast majority of the money in circulation was held outside the banking sector, in cash. But behind the scenes, there was a shadow hunting through the depths of the data that the exercise generated. And now that shadow is found to have some large and sharp teeth.

Economic and Financial Crimes Commission, EFCC, really has got the bit between its teeth in a way that few other anti-corruption bodies have managed elsewhere in the world. Yesterday, it brought two very high-profile figures before the court: a Senior Advocate of Nigeria (SAN), Muhammed Dele Belgore and a former minister, Professor Abubakar Sulaiman. They have pleaded not guilty in a case that has already tested the will of government to let the EFCC act independently and will now test the judiciary with which both defendants have a long and close history.

Case Summary: 

In February, 2017 James Michael Farrell, age 63, of Wenonah, New Jersey, USA was convicted of money laundering, witness tampering, and obstruction of official proceedings, related to his activities on behalf of members of an extensive drug trafficking operation. The case is important because part of relates to the use of proceeds of criminal conduct being used for the payment of defence lawyer's fees.

Type of conduct: 
Money Laundering

On 30 January 2017, the NYDFS superintendent, Maria Vullo, announced that Deutsche Bank would pay a fine of USD425 million for failures in counter-money laundering systems and controls, in an investigation closely linked with a similar investigation into the same facts by the UK's Financial Conduct Authority. What the NYDFS found is disturbing.

It has long been a bone of contention in London that, in particular, US, Japanese and German banks set up local systems to comply with their head office measures, even where those fall short of requirements in the UK. In the case of US and Japanese banks, it's been a matter of arrogance. In the case of German banks, it started off as arrogance but that was complicated by the creation of "passported institutions" where a number of financial institutions have argued that home regulation trumps UK law and regulation. The FCA has had enough of that nonsense and has issued its biggest fine to date for money laundering control failures.

Case Summary: 

Right from the days of snake oil potions and the Carbolic Smokeball Company, charlatans have sold fake pharma to the gullible and the desperate. Amongst the most desperate, and the most gullible, are those who believed the claims by a company that it had a herbal preparation that increased length and girth of the penis and increased sexual performance. As a herbal preparation, the product sidestepped US Food and Drug Administration approval. Thousands of customers who paid a substantial amount for the tablets complained they did not work as advertised, or at all. The Department of Justice and other agencies had to take a look.

Type of conduct: 
Money Laundering

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