Archive for June, 2008

US removes North Korea from Terror List

Monday, June 30th, 2008

Recently, the United States, namely the Bush administration, has talen a decision to remove North Korea from its state sponsors of terror list and end economic sanctions against this Asian country.

However, the above-mentioned news is not likely to have a sufficient impact on how financial institutions and other companies will deal with this Asian country.

Plans to remove North Korea from the terror list within 45 days were announced on June 26, 2008. North Korea was included into the list in January 1988.

It should be noted that discussions with North Korea about excluding it from the terrorism list have been held for at least 8 years. The country’s officials have been asking to remove it. This is seen as part of the price for being more welcoming in the nuclear disarmament negotiations over dismantling that nuclear weapons program.

Former Springfield businessman denies money-laundering, tax charges and bank fraud

Thursday, June 26th, 2008

On June 26, 2008, a former Springfield businessman, Michael J. Armitage, denied money-laundering, tax charges and bank fraud in federal court.

He pleaded innocent to 7 criminal counts that were related with allegations, according to which he secured bank loans by means of concealing significant tax debt and USD 1 million by him embezzled from his own company. This scheme was uncovered by his partners in 1999.

A 55-year-old Armitage was released on a USD 500 000 unsecured bond, and travel restrictions were imposed.

According to the U.S. Attorney’s Office, Armitage could face up to 30 years in prison as well as a USD 1 million fine.

Money-laundering in football to be investigated

Saturday, June 21st, 2008

There are claims that football clubs as well as other sports teams are being used to conceal money laundering. The intergovenmental body will investigate this matter.

On June 17, 2008, the Financial Action Task Force (FATF) decided to investigate whether sporting clubs in Europe, the United States and South America are really used in order to process illicit money through player transfers and investments.

The FATF president, Sir James Sassoon, said that the project is to show the attempts to “pick out things from across the waterfront that could present material vulnerabilities to the financial system”.

A meeting of the FATF in London gave final approval to this project as it has attracted great interest from its 34 members.

Saudi Arabia to fight money laundering more effectively

Tuesday, June 17th, 2008

Saudi Arabia and several member countries of the Financial Action Task Force (FATF) have decided to intensify their efforts to fight money laundering on three levels – local, regional and international.

On June 15, 2008, Dr. Ibrahim Al-Assaf, Minister of Finance of Saudi Arabia, said that “the Kingdom is among the first few countries, which gave special attention to counter money laundering by committing to and complying with many rules and international conventions, and putting them into practice”.

When speaking at a seminar organized by the Riyadh-based Institute of Public Administration (IPA), the Minister said that a FATF working group on financial measures, that among its members has Saudi Arabia and the Gulf Cooperation Council (GCC), had been exerting extensive efforts in the area of financial crime and money laundering. Al-Assaf said that the Kingdom had been realizing the seriousness of the problem of combatting money laundering at an early stage.

EU takes legal action against 15 states regarding money-laundering legislation

Thursday, June 12th, 2008

The European Commission has recently announced that it is stepping up legal proceedings against 15 member states as they have failed to implement the 3rd money-laundering directive into their national legislation.

According to the commission, the member states that failed to implement the rules into their national laws by December 2007 are as follows:

  • Belgium,

  • Czech Republic,

  • Germany,

  • Greece,

  • Spain,

  • Finland,

  • France,

  • Ireland,

  • Luxembourg,

  • Malta,

  • the Netherlands,

  • Poland,

  • Portugal,

  • Sweden,

  • Slovakia.

The 3rd money-laundering directive involves the financial sector as well as lawyers, accountants, notaries, real estate agents, trusts, casinos and company service providers. The directive states that they must verify customer identity and report suspicious transactions.

The request is a reasoned opinion, however, if there is no satisfactory reply within 2 months, the European Commission may refer this matter to the European Court of Justice.

India amends Prevention of Money Laudering Act

Sunday, June 8th, 2008

Working on fighting money laundering, on June 5, the Indian Government decided to bring casinos, credit card payment gateways run by Visa and Mastercard, money changers and transfer service providers like Western Union under the Indian law that aims at predicting money laundering.

The Indian Government is going to make the amendments to the Prevention of Money Laudering Act (PMLA). It will become mandatory for the above-mentioned financial intermediaries to report all suspected transactions that involve international transfers. This decision was taken by the Union Cabinet that is presided over by Prime Minister Manmohan Singh.

Also, a new category of offences of cross border implication will be added in order to prevent the fund transfer linked to an international crime.

Currently, only the banks and other financial institutions are obliged to report suspicious transactions  on regular basis to the financial intelligent unit (FIU) working under Finance Ministry.

EU excludes Jersey, Guernsey and the Isle of Man from money-laundering “white list”

Wednesday, June 4th, 2008

The European Union has recently made a new decision to leave the tax havens off a ‘white list’ of countries having satisfactory controls against money-laundering. Jersey, Guernsey and the Isle of Man were considered as tax havens not deserving a line in a money-laundering “white list”.

The EU has placed Jersey, Guernsey and the Isle of Man on an “intermediate”’ list of financial centres that “may” meet compliance regulations. It goes without saying that this move angered the three jurisdictions claiming that they have done everything possible to put all the necessary affairs in order.

Other two offshore jurisdictions – the British Virgin Islands and the Cayman Islands have been excluded, which means that they are effectively blacklisted.

According to Guernsey’s finance minister Charles Parkinson, the decision to exclude the offshore jurisdictions from the list was a political one and it followed claims from some financiers that other countries of the European Union were not competitive as compared to tax havens.