FINANCIAL CRIME DIGEST February 2021 Diligent analysis. Powering business.™ aperio-intelligence.com FINANCIAL CRIME DIGEST | FEBRUARY 2021 ISSN: 2632-8364 About Us Founded in 2014, Aperio Intelligence is a specialist, independent corporate intelligence frm, headquartered in London. Collectively our team has decades of experience in undertaking complex investigations and intelligence analysis. We speak over twenty languages in- house, including all major European languages, as well as Russian, Arabic, Farsi, Mandarin and Cantonese. We have completed more than 3,000 assignments over the last three years, involving some 150 territories. Our client base includes a broad range of leading international fnancial institutions, law frms and multinationals. Our role is to help identify and understand fnancial crime, contacts, cultivated over decades, who support us regularly integrity and reputational risks, which can arise from a lack in undertaking local enquiries on a confdential and discreet of knowledge of counterparties or local jurisdictions, basis. As a specialist provider of corporate intelligence, we enabling our clients to make better informed decisions. source information and undertake research to the highest legal and ethical standards. Our independence means we Our due diligence practice helps clients comply with anti- avoid potential conficts of interest that can affect larger bribery and corruption, anti-money laundering and other organisations. relevant fnancial crime legislation, such as sanctions compliance, or the evaluation of tax evasion or sanctions We work on a “Client First” basis, founded on a strong risks. Our services support the on-boarding, periodic or commitment to quality control, confdentiality and respect retrospective review of clients or third parties. for time constraints. We offer robust, cost-effective solutions, providing our clients with work of the highest Our investigations practice advises clients in a wide range quality at favourable rates. of complex disputes and other contentious matters, including complex cross-border asset tracing claims, Please do not hesitate to get in touch with us if you would litigation support, internal investigations, market like to know more about Aperio’s services or discuss how intelligence, supply chain analysis and country risk we might be able to help you: assessments. Our team has specialist knowledge of and access to a very Email [email protected] or fnd out broad range of public and proprietary data sources, as well more at: aperio-intelligence.com as a longstanding network of reliable, informed local 1 aperio-intelligence.com FINANCIAL CRIME DIGEST | FEBRUARY 2021 CONTENTS REPORTS AND SPEECHES 3 CONSULTATIONS 76 ENFORCEMENT 17 LITIGATION AND CASE LAW 79 SPECIAL FEATURE 30 PRESS AND MEDIA 82 LEGISLATION 34 ESG 92 GUIDANCE AND ANNOUNCEMENTS 48 INTRODUCTION Welcome to the February issue of the Financial Crime Digest. To receive the publication direct to your inbox every month, please sign up here. We are currently developing an online platform, which provides more comprehensive coverage of fnancial crime developments. If you would like more information on the new platform or our services please email [email protected] Aperio Intelligence’s next webinar ‘Fraud Trends in the Pandemic: Challenges for Business’ will take place at 13.00 on 10 March. Hosted by Aperio’s Director of Investigations, Paul Doran, our panel of guest speakers will share their views on how the pandemic has created opportunities for fraud in the corporate sphere and more widely. Please register your interest here. EDITOR’S PICKS SPECIAL FEATURE page 30 GUIDANCE AND ANNOUNCEMENTS page 48 28 February 2021 25 February 2021 Countering fnancial crime with the help of AI FATF outcomes of second plenary under and machine learning post Covid-19 German presidency, includes crypto consultation LEGISLATION page 34 CONSULTATIONS page 76 04 February 2021 11 February 2021 EU supervisory bodies publish draft proposal UK consults on digital ID and trust framework on sustainability disclosures in the fnancial sector DATES FOR THE DIARY see all events MARCH MARCH Aperio Intelligence webinar on Fraud Trends in UK consultation on digital identity and trust 10 the Pandemic: Challenges for Business 11 framework closes MARCH MARCH UK government consultation on the National UK consultation on the regulatory approach to 10 Fraud Initiative closes 21 cryptoassets and stablecoins closes 2 aperio-intelligence.com FINANCIAL CRIME DIGEST | FEBRUARY 2021 REPORTS AND SPEECHES OECD publishes report on professional enablers of tax and white-collar crimes According to the OECD, the targeting of implementation of a professional professional enablers can play an enablers’ strategy should be important role in addressing fnancial established. Countries are also advised crime by reducing the “accessibility of to implement multi-disciplinary sophisticated means” of committing prevention and disruption strategies, these crimes. Additionally, the report while ensuring the effective exchange points out that the risk created by such of information. enablers to society is visible during the Covid-19 pandemic and is related to the A set of frequently asked questions perpetration of fraudulent access to (FAQs) was issued on the same day. pandemic support funding. The report’s fndings will be discussed during the forthcoming OECD Global The Organisation for Economic In order to tackle the vulnerabilities, the Anti-Corruption and Integrity Forum, Cooperation and Development’s OECD calls on countries to ensure that due to take place on 23-25 March. (OECD) Task Force on Tax Crime and tax crime investigators can identify Other Crimes published on 25 February perpetrators and that they are aware of OECD press release its latest report on professional the risks associated with professional enablers of tax and white-collar enablers. Additionally, they must ensure OECD report crimes, which notes that even though that law enforcement have the most professionals are law-abiding and necessary tools to identify perpetrators OECD FAQs play an important role in compliance, a and the authority to prosecute and small portion of them knowingly sanction them, while a lead person and facilitate crime. agency responsible for overseeing the UK Pensions Regulator investigating fraud cases The Executive Director of the UK’s fraudsters believed to have left the the committee on pensions fraud. Pensions Regulator (TPR) Nicola country under the TPR’s extradition During the session, she noted that the Parish announced on 9 February that powers. During a UK Parliament Work scale of pensions fraud in the UK is the UK public body is conducting seven and Pensions Committee hearing on 6 likely to be signifcantly higher than investigations into 52 suspected January, Parish indicated that the TPR Action Fraud statistics. long-term savings fraud schemes is looking into 82 schemes, with the totalling over £55 million. scale of the alleged fraud amounting to TPR Talks – Episode 1 more than £54 million. The fgures were presented during the Committee oral evidence t... watchdog’s frst podcast, which also set Parish was among four ofcials out how the regulator plans to identify summoned to give oral evidence before TPR written evidence (Sep... 3 aperio-intelligence.com FINANCIAL CRIME DIGEST | FEBRUARY 2021 UN High-Level Panel on fnancial accountability and transparency publishes fnal report The FACTI panel found that the lack of Pakistan’s Prime Minister Imran Khan a “single body tasked with global suggested that the UN should negotiate coordination” makes tackling tax crime, “new international tax cooperation and money laundering (ML), terrorist anti-money laundering legal fnancing (TF) and corruption difcult, in instruments” and establish a UN-level particular in developing countries. The “coordination, adjudication, and panel suggests creating an mediation mechanism” to detect IFFs. International Compact on Implementing Financial Integrity for Sustainable Financial Action Task Force (FATF) Development, a Centre for Monitoring President Marcus Pleyer stated during Taxing Rights, as well as inclusive the event that countries do not intergovernmental bodies on tax necessarily need to adopt new The UN High-Level Panel on matters and ML. standards to address IFFs, but must International Financial Accountability, effectively implement the current FATF Transparency and Integrity for At the same time, the panel proposes a recommendations. Additionally, he Achieving the 2030 Agenda for global pact on fnancial integrity for emphasised that countries need to Sustainable Development (FACTI) sustainable development based on consider solutions for ensuring the launched on 25 February its fnal national priorities, a UN tax convention effective supervision of professional report, which includes 14 with universal participation, and a ML/TF enablers, especially lawyers, recommendations to close loopholes in global minimum corporate tax when self-regulation proves ineffective. the global fnancial system that enable agreement. In addition, FACTI suggests 2.7 percent of global gross domestic adopting common international Pleyer stated that countries should be product to be laundered annually and standards for settlement in able to cross-check BO information, up to $650 billion lost to haven cross-border corruption cases and for while underlining that FATF cannot ask countries every year. fnancial, legal, accounting, and other its member states to introduce publicly